Taking a year out - rental income query

Joe Nonety

Registered User
Messages
418
I plan to take a year out to go travelling. I plan to rent out my house while I'm away but was wondering what the tax implications are.
I'm renting out some rooms at the moment getting less that the €10,000 threshold. When I go travelling I will earn €12,000. What are the tax implications for these earnings?
Does the 0% stamp duty that I paid plus the TRS I receive get affected by my house being no longer owner occupied. Technically it's a year long holiday so I was hoping that holidays don't disqualify you from being owner occupied or does it?
 
Tax implications of such a move Joe are:

You will pay income tax on the full €12000 (minus deductions and interest if registered with PRTB) as it no longer falls within the rent a room scheme.

If you have purchased your house in past 2 years you will be liable for stamp suty clawback.

Once you rent the house out in its entirety you are no longer entitled to TRS as the house is no longer your PPR.

Hope this helps...
 
Thanks Cayne.
If I leave just 4 months into the tax year i.e. after April 30th, which means I'll have earnt less than €18300 in my normal job, which is amount people can earn before entering the tax net, does that mean the rental income up until I reach €18300 will be at 0% tax, and above it (until €35100) at 20%? Or is rental income done differently?
 
Can't help about stamp duty clawback but you'll find a very good "Guide to Rental Income" on the revenue.ie website.
So even though you lose your TRS you do in fact get to claim more of your interest payments against your taxable income.
So depending what your interest payments are....your bank usually sends you an annual statement of these...and your other allowable expenses....such as a % of the cost of your furniture...your PRTB membership...your agency fees...your management fees etc....then apply the 20% tax payble to the remainder of the income.