Should I register my investment property?

Hello everyone,
My partner and I bought our first investment property back in december 2005.As of January we've had it rented out for 900euro p/m.Its costing us about 800euro in interest only re-payments,so we've got about 100euro surplus each month.
We spent about 4000euro in furnishing and a management fee of 1500euro p/annum,so any profits from rental income is been swallowed up.As of yet we have'nt registered our investment with the Revenue or anyone else and im unsure as to why we should bother.If anyone out there could shed some light on whether or not we should disclose our investment to the revenue i would be very grateful.
Thanks in advance....

Re: Should I register my investment property??

johnboy79 said:

.As of yet we have'nt registered our investment with the Revenue or anyone else and im unsure as to why we should bother.

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Er, because you are legally obliged to register with the PRTB and to deal with any tax liabilities arising from the investment property.

Re: Should I register my investment property??

I can only assume you're trolling. The pros and cons of being tax compliant are self evident. Hoping this thread gets locked soon.

Re: Should I register my investment property??

johnboy79 said:

why we should bother

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[gets on high horse]
Because we all pay taxes why shouldn't you
[gets off high horse]

The penalty is very stiff for not registering ... and you will be caught if you tenant registrars for rent relief....

Re: Should I register my investment property??

thanks for the replies but as im not making any profit from the rental income then why have i a tax obligation?

Re: Should I register my investment property??

Are you getting tax relief at source on your mortgage and did you pay stamp duty at the investor rate when you purchased?

Re: Should I register my investment property??

In short johnboy - you asked th question as to whether you should or not....and the answer is yes you MUST....like it or not


ninsaga

Re: Should I register my investment property??

johnboy79 said:

thanks for the replies but as im not making any profit from the rental income then why have i a tax obligation?

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*boggle!*

So what you're saying is that you want to have a self-paying mortgage on a home? This post will be deleted if not edited immediately, if you're going to do what you're doing why only stop at one house, take out 20 mortgages and buy 20 houses. Sell off 35 years from now and you'll have tens of millions! Genius!

Re: Should I register my investment property??

I get the impression many investors think "I don't need to let the taxman know, sure I'm renting to a group of polish builders, there's no way the revenue will find out that I'm not living in the property myself"

Surely it would be pretty easy for banks to determine which of their customers have investment properties. They just look for monthly morgage outpayments and monthly rental incomings for a particular account or individual (who may have multiple accounts). It should be relativly easy to distinguish rental incomings from wages.

In a few years time the revenue may decide to investigate non payment of income tax on rental returns or capital gains tax on resale or incorrect stamp duty payment. Especially if there is less tax coming in from property sales down the line. All the revenue will have to do is ask the banks to provide the required info.

After all how many people said in the 80s as they opened a non-resident account "sure how will the revenue ever find out about it". Simple - just ask the bank.

Re: Should I register my investment property??

Totally agree with persius

Last year revenue went after the service industry this year it is the construction industry
Next year? the investment property owners......fingers crossed. Revenue have consistently stated that ignorance is no excuse for non complinance

Re: Should I register my investment property??

I wonder what's the estimate on the percentage of landlords who pay nothing on profits made from rent. I would say it's anything from 25-45% myself, taking that percentage of tax evaders and rental properties currently filled I wonder how much revenue the government is losing here. It's surely a substantial amount and if it was pursued, what do you think would happen to the rental market (in particular apartments which usually have a €1,000+ maintenance charge)? If I was in Messr Ahern's shoes, I'd go Stasi on their asses and round them up. €200 bounty for an tennant/neighbour who shops in a tax dodger!

Re: Should I register my investment property??

Interesting ideas there

They brought in a scheme in England where you can report tax evasion i.e grass on your neighbour or the plumber who you pay cash to.

I wonder would it work in Ireland?......i know a few people who i know for a fact are not tax compliant and i would have no hesitation in reporting on them even more so if i was to get paid

Re: Should I register my investment property??

jhegarty said:

and you will be caught if you tenant registrars for rent relief....

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When I was applying for rent relief I went to my landlord for his details. When he asked why I needed his address/PPS/etc, he got extremely worried when I told him why. I let him take the money from my next months rent, even though that would make me complicit to his evasion. I suppose I just didn't want the fella to be put in a hole.

60% or so of other tennants I know would tell the same story.

Re: Should I register my investment property??

johnboy79 said:

thanks for the replies but as im not making any profit from the rental income then why have i a tax obligation?

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You really need to get independent, professional advice on the investment aspects of this venture. Never mind the tax issues!