Selling my home but with Questions

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profasoc

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Hi I am now to this forum and have a few question which I hope you can help me with.

I am looking to sell my appartment which is being rented at the moment as I live in Central America for work. I was told that I would have to pay tax as an investor, is this true? I am a first time buyer and only own the appartment, I ma registered as living abroud wilt the authorities, what can I do?

Thanks for any insight.
 
Commuting is out of the question ????? lol.

If you didn't pay stamp duty on the apt when you bought it , you are going to have a stamp duty liability also.
 
If the property is rented out, other than under the owner occupier rent a room scheme, then you are de facto an investor notwithstanding the fact that you were a first time buyer. As such you would be liable for income tax on rental income, no owner occupier mortgage interest relief (although you can offset 100% of mortgage interest against rental income as an allowable expense), CGT on the sale of the property and, if the property was rented out within five years of purchase, then you are also liable for a clawback of stamp duty (i.e. difference between what an investor would have paid and what you actually paid). You would only qualify for the owner occupier rent a room scheme if the property was your principal private residence, and you were seconded to work abroad rather than just choosing to and you are earning €7,620 or less p.a. in rental income. Otherwise the investor tax treatment outlined above and in other posts in the Property Investment forum applies. On the other hand are you sure that you are resident for tax purposes in Ireland now that you are living abroad? How long have you been away and how long do you spend in Ireland each year?

If in doubt about your liabilities then seek independent, professional advice.
 
Thanks Clubman,


In a certain sence I have been posted out here as it is not possible to do my job in Ireland. I bought the appartment in November 2003 and lived in it untill January 2005. All my taxes are dealt with out side or Ireland as I work for a Swiss Company, I dont pay them in Ireland. It was my first home nad I did not pay stam duty for this reason. I have registered the appartment as rented and I pay tax on this. PLease let me know if you need any more info, and thanks for the help.
 
profasoc said:
I bought the appartment in November 2003 and lived in it untill January 2005. All my taxes are dealt with out side or Ireland as I work for a Swiss Company, I dont pay them in Ireland. It was my first home nad I did not pay stam duty for this reason. I have registered the appartment as rented and I pay tax on this. PLease let me know if you need any more info, and thanks for the help.
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You rented the property out within five years of purchase as an owner occupier so you are liable for the stamp duty clawback as soon as the property was rented - see . When you say registered do you mean with the PRTB or something?
 
Thanks I was worried about this. The stamp duty I will have to pay on the sale will be on the whole price or what I actually recieve after paying my mortgage back. I remember I registere with some offical organ and that I declaire what i get for rent at the end of each year. Would you also know what comissions real estate agents charge. The poperty value at the moment is 460.000 euros as of estimates.

Thanks again for the help.
 
If you read the OASIS link and the information that I posted earlier then you will see that the SD clawback is the amount of stamp duty that an investor would have paid on the purchase in November 2003 less whatever you paid at the time (in this case nothing). So you take the purchase price at the time, refer to the SD rates for the investor SD rate on that price bracket and apply the relevant investor rate of SD to calculate your liability. So, basically, the clawback will be some percentage of the original purchase price and the amount outstanding on the mortgage is irrelevant. For example, at today's rates of SD (see OASIS again) an investor would pay 5% on a house costing between €254,001 and €317,500. The rates of SD may have been different in 2003 compare to those that apply today but today's rates may give you an idea of the extent of your liability.
 
As profasoc is a non-resident, Central America, and is taxed in a 3rd country, is Irish tax law applicable here?
 
Purple said:
As profasoc is a non-resident, Central America, and is taxed in a 3rd country, is Irish tax law applicable here?
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It's not clear if he is non resident in tax terms.
 
Hi Thanks again,


No I am not tax liable in Ireland from what I know because of the job I do and as well because of my nationality I am Italian but married to and Irish person. I am liable for taxes here in Central America and/or Switzerland depending on where I declaire to revenue.
 
As far as I know, Irish tax law is always applicable in the first instance to real property ( i.e. land, houses etc). There may be a secondary liability in your country of tax residence after that depending on those tax laws.
 
As Vanilla implies, the clawback may still be an issue even if the individual is not tax resident (not necessarily the same as not being physically resident - check [broken link removed] for precise details) and could lead to problems when it comes to reselling the property and the outstanding liability comes to light. If in doubt get independent, professional advice.
 
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