Rental query: I'm a landlord...

The Minstrel

...living in a 2-bed flat in town, and have been renting out the other room. Currently in the process of showing the room to prospective tenants. Previously I have just been getting a deposit of one month's rent and a month's rent in advance. - is this normal practice or should I be looking for 2 months in advance?

Also, should I be getting tenants to sign a lease? And what constitutes a lease?

Calina

Technically, your cohabiting person will be a licensee not a tenant and for your own peace of mind get some sort of agreement in place.

Normal practice is one month's deposit and one month rent in advance.

Also, I speaking from experience, owner occupied accommodation is less attractive to many people for a huge variety of reasons.

gaeilgegrinds

Moving on from this, if a lease is signed and then the tenant loses their job and has to move...what then? What does the law say?

The_Conductor

As per what Calina said- you are not a landlord, you are letting a room in your apartment, which continues to be your Place of Principle Residence.

As such- you should under no circumstances sign away any rights that you may have- through the issue of a lease. A few simple house rules are what should be drawn up and adhered to (no guests over without your prior agreement, water to be turned off after use, how household bills are to be apportioned, what constitutes a reasonable amount of notice when leaving etc.)

The person who is living with you, is living with you "under licence" and has no rights whatsoever under Irish tenancy law. The extends to periods of notice on your part- though it is good manners for you to give them reasonable notice of when you are seeking the room back.

Similarly- the major benefit for you of renting out a room- is the rent-a-room scheme, whereby you can earn EUR10k taxfree by renting out rooms in your house (providing you continue to reside there yourself). You are obliged to make an annual tax return declaring the income (in its entirety- including any monies towards bills etc) and the person renting the room is entitled to claim a credit for rent-relief (which means even if there is no tax due- you cannot ignore the requirement for convenience's sake).

If you've any questions at all- feel free to post here.

S.

MysticalSoul

As an owner - occupier, I drew up a Lease, which dictates either party is required to give one month's notice to the other party re the tenant moving out.

gaeilgegrinds

Is it possible to draw up a lease for a year? Have never done but my most recent tenant told me their last place of residence had this but they found out it was illegal. Is it?

The_Conductor

gaeilgegrinds wrote: »

Is it possible to draw up a lease for a year? Have never done but my most recent tenant told me their last place of residence had this but they found out it was illegal. Is it?

There is a difference between the document being illegal, and it not being possible to legally enforce it. Without knowing the particulars- its impossible to even guess at the merit of the lease. In theory- I cannot see what the issue with a 1 year lease might be- other than rights under the 2004 Residential Tenancies Act might very well supersede terms and conditions of the lease itself. Short term leases such as this might be more normal in a commercial context, rather than in a residential context.

subway

irishamethyst wrote: »

As an owner - occupier, I drew up a Lease, which dictates either party is required to give one month's notice to the other party re the tenant moving out.

as an owner occupier you dont need to give notice.
you are signing away your rights.

The_Conductor

subway wrote: »

as an owner occupier you dont need to give notice.
you are signing away your rights.

Big time.

As an owner occupier- you are simply taking in a lodger into your own home, to help with the bills. You are not a landlord, and the person who 'rents' your room, is not a tenant. They have precisely no rights- and can be asked to leave with no notice whatsoever by the home owner, and without any reason being given. It makes zero sense to sign a document imparting rights on the lodger, that simply do not exist in law.

There have been a number of threads in this forum recently, where people assumed that by taking a person into their home under the Rent-a-Room scheme- that they were(are) landlords and the person a tenant. It is not so......

gaeilgegrinds

Ok so now I understand where I stand I've a query about a friend. Has signed a year long lease. Seems 28 days written notice is enough to get out of it, is this definetely the case?

MysticalSoul

subway wrote: »

as an owner occupier you dont need to give notice.
you are signing away your rights..

I do this out of common courtesy, as I would never tell someone to move out tomorrow. A month isn't exactly a long time anyway.

MysticalSoul

gaeilgegrinds wrote: »

Ok so now I understand where I stand I've a query about a friend. Has signed a year long lease. Seems 28 days written notice is enough to get out of it, is this definetely the case?

If that is what is written on the Lease, yes.

gaeilgegrinds

If it's not?

The_Conductor

gaeilgegrinds wrote: »

If it's not?

The lease is a legally binding document- which is enforceable by the courts, should a landlord decide to take a civil suit against the person who signed the lease. It would be a civil as opposed to a criminal suit, and any conviction would not impact elsewhere.

The Residential Tenancies Act specifies periods of notice. You are not breaking the law by giving the notice in the act- you are however breaking your lease, which is entirely a seperate matter- and is dealt with in entirely a separate manner.

The Minstrel

Regarding the rent-a-room scheme, 10k tax-free earnings: if I was to move out to live elsewhere, would I be eligible to some sort of similar tax relief/rebate on the rent that I would be paying?

I imagine that there would be a sizeable minority of single-property owners who do not declare the fact that they rent elsewhere, so as to avoid losing out on the rent-a-room scheme. Is this something that revenue are very focused on?

The_Conductor

The Minstrel wrote: »

Regarding the rent-a-room scheme, 10k tax-free earnings: if I was to move out to live elsewhere, would I be eligible to some sort of similar tax relief/rebate on the rent that I would be paying?

I imagine that there would be a sizeable minority of single-property owners who do not declare the fact that they rent elsewhere, so as to avoid losing out on the rent-a-room scheme. Is this something that revenue are very focused on?

You have to make an annual tax return specifically to declare the income- despite the fact that there may be no tax due on it. Compliance is getting better and better- as the person who is renting the room is entitled to claim rent-relief (its worth less than EUR300 a year- but a good enough reason to claim it)- all they have to do is supply the address of the property to the Revenue Commissioners- who can then do their magic.

There is a new section in the Revenue Commissioners looking at this- from a few different perspectives- but mostly from the stamp duty angle- as owners who do not declare the income under the rent-a-room scheme are considered to have rented their property- and may have their original stamp duty reaccessed as investors. This is potentially far harsher treatment than simply letting out the whole house, declaring the income and paying whatever tax may be due on it.......

In the current climate with government finances bolloxed, its not a good idea to try to play games with the Revenue Commissioners. You won't win.

Calina

The Minstrel wrote: »

Regarding the rent-a-room scheme, 10k tax-free earnings: if I was to move out to live elsewhere, would I be eligible to some sort of similar tax relief/rebate on the rent that I would be paying?

I imagine that there would be a sizeable minority of single-property owners who do not declare the fact that they rent elsewhere, so as to avoid losing out on the rent-a-room scheme. Is this something that revenue are very focused on?

Your property would cease to be owner occupied and as such you would not come under the rent-a-room scheme any more if you moved out of it. As such it becomes an investment property and the taxation rules are some what different.

After that, I assume if you are renting yourself, you would be entitled to the rental tax allowance which isn't exactly huge but it's there.

I think you will find that in times of need, Revenue will start getting interested in various tax evasions. I personally wouldn't risk trying to sidestep the issue if I were in that position.

Mrs OBumble

irishamethyst wrote: »

I do this out of common courtesy, as I would never tell someone to move out tomorrow. A month isn't exactly a long time anyway.

A month can be a mightily long time if you discover your rent-a-roomee has some sociopathic tendancies that you didn't know about before they moved in. (Could be anything from separated-parent-with-custody, pornography addict, alcoholic, child-abuser, musician-at-3am, insists on leaving the toilet seat up - whatever it is that really pushes your buttons.)

If you were just another tenant, you would have the option of moving out. As an owner you don't. So you need the protection of being able to move them out quickly if things go pear-shaped.

That doesn't mean you kick 'em out into the street. Just be aware of backpacker hostels and the like which offer easy-in-easy-out accommodation if someone needs it.

I held the lease on a 4-bedroom flat for years. Found that once someone had said they were moving out the last few weeks were a strain, and it was always difficult to get someone new for a room while the old tenant was still there. So I worked with a policy that people could leave with as little notice as they wanted, provided they left the room clean. That meant they were free to move as soon as they found something new, and stopped them paying double-rent. Cost me a little in covering extra rent occasionally, but it was worth it for the smoother relationships in the house.

The Minstrel

JustMary wrote: »

insists on leaving the toilet seat up - whatever it is that really pushes your buttons

Toilet seat thing always seem to be a major issue with birds. Why not just pop it back down? Simple as.

dny123456

'cause after i've urinated on it, I don't really want to touch it!