Renting a house I own while renting a place for myself

bullvine

Hi,

Some opinion needed, Currently own a 4 bedroom house, I have 4 friends living in it. Need to put everything through the books. I'm also renting a 2 bed Apartment myself with my wife. Simple maths question, if they give me 1700 and my rent is 1400 per month, does anybody know the tax implications of this. Do I still need to pay tax on the 1700 or am I entitled to some extra relief because I'm also renting.

Anybody any experience of this or in a similar position.

Thanks,

The_Conductor

Your entire rental income (less expenses) is taxable income and must be declared in an annual tax return. You must also register the tenancy with the PRTB. With respect of the apartment you are renting- you are entitled to claim rental relief (which only comes to about E300 per annum, but its better in your pocket than in the Revenue Commissioners). The people renting your house are likewise entitled to claim rental relief (of E300~) per annum on the rent they are paying you. This is processed as a credit by the Revenue Commissioners.

Shane

bullvine

Thanks,

Thats what I thought, thanks for clearing that up for me

patrickolee

I know it wasn't in your original question, but you potentially also have tax issues if you ever decided to sell the house? Could you kick 2 of the friends out of the house and move in with your wife?

RainyDay

Note that any mortgage interest you are paying on the house is a legitimate expense for tax purposes. You are liable for tax on your 'profit' on the rented house, i.e. rent less mortgage interest (not your full mortgage payment) less legitimate maintenance expenses on that property.

The_Conductor

Also durable goods may be depreciated in a flat line deduction over a 5 year period. You will of course need receipts etc for everything in order to do this.