Tax on Rental property

[JohnJay]

Sorry about this basic question, but I am a tax virgin!

I'm an employee, paying tax in the upper bracket.

I'm thinking about buying a property, which I would like to live i eventually, but I want to rent it out for a few years first.

How would I be taxed on the rental income? Can I offset the mortgage/interest against the income?

Say for example my mortgage repayments were 1650 pm, roughly 1200 of this is interest for the first few years. If I rented this out for 1200, would that mean I would pay no tax?

Also, if I carried out any building work on this property, could I write this off against tax?

 

[webtax]

What is you reasoning behind renting out the property for a few years first? As per your example, you will not be making any profit on the property in this time. Also, if you buy a property to rent out you will not be able to avail of the FTB's stamp duty exemption on it.
Yes, you can offset the mortgage interest against the income.
Building work carried out on the property cannot be written off against income tax, but will be included in the costs when calculating capital gains tax.

 

[ClubMan]

I'm thinking about buying a property, which I would like to live i eventually, but I want to rent it out for a few years first.

You will have to pay investor stamp duty on this purchase and cannot avail of FTB owner occupier relief.

How would I be taxed on the rental income? Can I offset the mortgage/interest against the income?

See the Property Investment FAQ, key posts and other threads on similar issues.

Say for example my mortgage repayments were 1650 pm, roughly 1200 of this is interest for the first few years. If I rented this out for 1200, would that mean I would pay no tax?

See the Property Investment key post/thread on having an interest only mortgage on an investment property to maximise the interest allowable against rental income.

Also, if I carried out any building work on this property, could I write this off against tax?

Interest on loans used to purchase of renovate a property may qualify for owner occupier mortgage interest relief (in an owner occupier situation) or for offsetting against rental income (in a rental/investment property situation).