Tax on rent relief

grizzly

My brother asked me to help him with this. He's paying rent on a property for the last 2 years, tried to claim rent relief while trying to get the landlords PPL number he discovered he's living abroad. On the form it says;

Rents payable to non-resident landlords
If your landlord resides outside the country and you pay the rent directly to him/her or into his/her bank account either
in the State or abroad, you must deduct tax at the standard rate of tax (2008: 20%) from the gross rent payable.
Example: Gross rent per month €1,000
Deduct standard rate tax (€1,000 x 20%) € 200
Pay to Landlord (€1,000 - €200) € 800
If you pay tax under the PAYE system, you account for the tax deducted by reducing your tax credits and Standard
Rate Cut-Off Point. You must notify your Local Revenue Office who will arrange this for you. If you pay tax under
self-assessment, account for the tax deducted will be displayed on your notice of assessment.
Failure to deduct tax leaves you liable for the tax that should have been deducted.

Does this mean he now has to come up with the money for the unpaid tax?

Victor

Is your brother paying an agent here or straight into the landlord's bank account?

Get the landlord to clarify things with the Revenue and possibly in the meantime withhold rent up to the 2 years x 20%.

grizzly

He pays the money into a bank account (Irish account). I'll ask him to check with the landlord about the Revenue payments.

If the landlord hasn't been making any tax payments he's not going to be happy about my brother withholding 20% (would mean next 6 months taken up with arrears).