Tax Question

[Culchie]

I have an investment property that I rent out 'down the country'.

I am selling my principal home in Dublin, will move into the rental house for a period of time, whilst we build a new house, so for approx 18months.

Once we move into the new house in 18 months time, it will be our intention to re-commence renting out our investment property again.

What (if any) are the tax implications of this?

My reading of it is that because I am selling my principal residence, and using the funds to build my new principal residence, then there will be no tax payable on the sale of my house in Dublin.

Do I need to advise the taxman when I move into my investment property for a period of 18 months, that this will be my principal residence for that period of time?

 

[Culchie]

^

Any help?

 

[murphaph]

Do I need to advise the taxman when I move into my investment property for a period of 18 months, that this will be my principal residence for that period of time?

I think you will so that you can at least claim TRS (if that applies to you) for the interest paid on the mortgage as it will be your PPR (You'll have to stop claiming 100% tax relief on the interest paid as that's only allowed on a property when let out). You'll also benefit from a lower CGT bill if you sell that investment house as the CGT 'accumulation' period should only include periods when the house was actually let out, not periods when it was your PPR!.

Probably worth a phonecall to revenue at the bare minimum to clarify. maybe someone else could help-I'm certainly no expert!