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Living rent-free: tax implications?

  • 31-07-2008 11:44am
    #1
    King Ian
    Registered Users, Registered Users 2 Posts: 142 ✭✭


    Hi I have an unusual situation which I've been wondering about recently.

    I moved to Cork a few months ago and have been living in apartment owned by an elderly Aunt and Uncle of mine. I don't pay them any rent, however I have an understanding with them that I will mind and maintain the place, and pay for any upkeep that needs to be done as and when it arises. (For example, a lot of painting and some electrical repair work which I had done recently, which was needed).

    They are happy with this situation, because they don't like the idea of the apartment lying empty, nor do they want to rent it out to strangers. They are not in need of the cash, and dont want the hassle of bringing in tenants they don't know.

    The question in my head is twofold:

    1) Are there tax implications for me in this scenario? Does the rent foregone by my aunt and uncle count as a "gift" for tax purposes? Or does my agreement with them in relation to upkeep, repairs etc. count as adequete rent?

    and

    2) Are there tax implications for them arising from it? ie. if the Revenue commissioners turn around and ask them where the rental income from their apartment is...?

    Im no legal expert so Im wondering if anyone knows the situaton with this?


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