Transfer of rental income

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paper-folder

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My wife and I are both working, top rate PAYE, single assessment. I also have a small rental income (property is in my name). She is thinking of taking a career break for a few years. I know that our tax position will disimprove if we have joint assessment and only one income.

My questions are;
-if the rental income was coming to her, would we then count as 'married couple, both spouses with income' for tax purposes (and get the benefit of a wider 20% tax band)?
-if so, is it enough to have the tenants pay the rent into her bank account, or would the property also have to be transferred into her name?

Thanks in anticipation from a new member,
Keep up the good work.
 
Hi,

The property would need to be transferred into her name for her to receive all the rental income or both yer names if ye want to split the rental income 50:50 Doesn't matter whose bank account it goes into.

Jockey
 
Would you not consider joint assessment election? I dont understand how your position could disimprove if such an election is made, it would surely stay the same, or maybe actually impove as she would be able to transfer any unused SRCOP over to you

Should you wish to have all or part of the rental income transferred to her you will need to transfer all or part of the title. Fortunately this can be done without setting of any tax charges such as CGT, SD and CAT
 
Hi Bazermc,My understanding is that at the moment under single assessment we both pay tax at 20% on our first €32,000 and the balance at 40%, allowing us the first €64,000 at the lower rate. Under joint assessment, and with my wife taking a career break (and having no income), the 20% band is limited to €41,000. There is another €23,000 available to claimed if she had income, this is why I was looking to tranfer the rental income to her.As my salary is in excess of €41,000...I'll end up paying 40% on all the balance and on the rental income too. This is correct isn't it?? Thanks for the good news that if we do decide to go for joint ownership, there are no tax charges involved (though presumably some legal fees).Paper-folder
 
My understanding is that the rental income will/can go towards utilizing the increase up to €23,000 in the bands (under joint assessment). A quick phone call to your local tax office self assessment section will clarify that for you.
 
I think a pertinent question might be to ask who exactly has beneficial interests in the house, notwithstandign the fact that you have the legal ownership.

Were your wife to own 50% of the beneficial itnerest in the house, then 1/2 of the profits/gains/losses attributable to that property are hers - even if you did go and treat it as your own all this time :mad:

Question is:- how would you prove this, perhaps your solictor might point you in the right direction.
 
I was on to the Dublin revenue 'hot-line' today (I was only waiting on-hold for 15 minutes, is this a record?). The very brief answer that I got before the call was ended/ we were cut off, was that, for her to claim the rent as income, the income would indeed have to be her's, and for this to be the case, the house would have to be in her name. The impression was, that claiming this as her income while the house remains in my name would not stand up in an audit.Aetius, I didn't get the chance to ask about beneficial interest in the property, by the sounds of things, from the Revenue point of view this would have to be backed up by having both names on the title deeds. Thanks everyone for your input.Paper-folder
 
paper-folder said:
The impression was....
Click to expand...
To be honest, unless they give you documented evidence to back up the opinion they give you, it's a wasted phone call. Advice you recieve from a Revenue official won't cover you in the event that the advice was incorrect (and that happens frequently).

For a case with complicated issues I'd suggest seeking help from an accountant/tax expert.
 
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