Non-resident landlord

floralys

Hi I have a question I hope I can get some advice on.
I found out recently that a tenant has to withhold 20% of the rent and forward to revenue. Although LL told me she was leaving the country when I signed the lease, (now she has gone) she asked that I put rent into her Irish bank account each month. This is what I have been doing.
Is there some arrangement she could have come up with herself with revenue, or is it all on me this point? Can I legally withhold 20% of 10 months of rent for revenue now?

Thanks for any help, I'd like to be aware of what my obligations (as a leaseholder) are before talking to LL about this.

Tow

From IT70

What If Your Landlord Is Not Resident In The State?

If your landlord resides outside the Republic of Ireland (the State) and you pay rent directly to them or to their bank account either in the State or abroad, you must deduct income tax at the standard rate of tax (currently 20%) from the gross rents payable.

Failure to deduct tax may leave you liable for the tax that should have been deducted.


Example
Gross Rent per month €1,000
Deduct tax €200
Pay to Landord €800

At the end of the year, you must give a completed Form R185 (PDF, 48KB)* to your landlord to show that the tax has been accounted for to Revenue. The landlord can then claim this amount as credit on their annual Tax Return.

floralys

Tow wrote: »

From IT70

Thank you - I understand what my obligations as a tenant are, however I also read that I would be in breach of the lease agreement by withholding rent for any reason - which I would have to do to compensate for not paying the LL's taxable income for the time I have lived here. My question above in bold applies:
Can I legally withhold 20% of 10 months of rent for revenue now?

djimi

It might be worth giving Threshold a call and go through your situation with them. Im not sure if the fact that your landlord was living in the country at the time you signed the lease changes your situation any. Did you recieve formal written notice of the landlords change of address and the fact that they now live outside of Ireland?

floralys

djimi wrote: »

It might be worth giving Threshold a call and go through your situation with them. Im not sure if the fact that your landlord was living in the country at the time you signed the lease changes your situation any. Did you recieve formal written notice of the landlords change of address and the fact that they now live outside of Ireland?

No there was no written notice. The address provided is in Ireland. Honestly, I don't think the LL will make an issue of it (I can't see how it is in her best interests to do so and she has proved to be a reasonable person). However I do want some facts to bring to the table if she does not want me to take all the money off the rent at once.
I will start to take the 20% from hereon in, but it is the months gone by that are concerning me. I will call threshold, thanks. I would call revenue too but would rather wait to see if the LL has a reasonable reason why I should not with-hold, like if she is paying tax privately or something... but I don't know if this is done or not.

djimi

If you have not been notified formally of their change in address then I dont see how you could be held liable for the 20% to be honest. I mean, how are you to know that they no longer live in Ireland? The landlord is legally obliged to notify you in writing of any change in their contact details; if they have not done this then as far as you are concerned they are still living in the address you currently have for them.

I would call Threshold and have an informal chat with them first to see what their opinion is before doing anything further. I wouldnt start withholding any rent just yet until you find out exactly where you stand. My gut feeling is that you are not responsible for witholding anything until you have been formally notified of the landlords change of address, but Threshold may see that differently.

markpb

floralys wrote: »

I also read that I would be in breach of the lease agreement by withholding rent for any reason?

I seriously doubt that there's any way a lease could revoke your legal requirements under national legislation.

floralys

djimi wrote: »

If you have not been notified formally of their change in address then I dont see how you could be held liable for the 20% to be honest. I mean, how are you to know that they no longer live in Ireland? The landlord is legally obliged to notify you in writing of any change in their contact details; if they have not done this then as far as you are concerned they are still living in the address you currently have for them.

I would call Threshold and have an informal chat with them first to see what their opinion is before doing anything further. I wouldnt start withholding any rent just yet until you find out exactly where you stand. My gut feeling is that you are not responsible for witholding anything until you have been formally notified of the landlords change of address, but Threshold may see that differently.

Thanks for that. Practically, I know she is abroad because she told me to my face before she left - but yes, technically, (and maybe legally) I have no idea where she is. Seems disingenuous but I will indeed call threshold today.

floralys

markpb wrote: »

I seriously doubt that there's any way a lease could revoke your legal requirements under national legislation.

If I had been doing it on a monthly basis already and explaining why to the LL, then I would agree - however I would be taking a lump sum off the rent to pay revenue.

markpb

floralys wrote: »

If I had been doing it on a monthly basis already and explaining why to the LL, then I would agree - however I would be taking a lump sum off the rent to pay revenue.

If it was me (and I'm in a similar situation), I'd start taking 20% off each months rent from now on and give it to revenue at the end of the year. If they ask why you didn't do it from the start, say you didn't know and you started deducting as soon as you found out. If they're receiving money from you, I suspect they're unlikely to ask too many questions.

If you're not happy with that, the next route is to explain to the landlord how much rent you have to withhold to make up the difference going backwards and tell them in advance when you'll be doing that. There's not much they can say if you're complying with the law.

quietsailor

You will need to talk to the LL before you do anything, one reason for people being abroad in these times is for work - a lot of people work abroad for a few months and then come home for their time off (person working on an oil rig is a good example), if this is the case then they will still be "resident for tax purposes" as far as the Revenue is concerned and it's not up to you to pay the revenue.

Talk to the LL first and ask are they resident or non-resident for tax purposes.

** Resident/non-resident for tax purposes is completely different to being resident or non-resident in the country **

anto9

Just pay your rent soft lad ,and stop worrying about the LL obligations .

floralys

quietsailor wrote: »

You will need to talk to the LL before you do anything, one reason for people being abroad in these times is for work - a lot of people work abroad for a few months and then come home for their time off (person working on an oil rig is a good example), if this is the case then they will still be "resident for tax purposes" as far as the Revenue is concerned and it's not up to you to pay the revenue.

Talk to the LL first and ask are they resident or non-resident for tax purposes.

** Resident/non-resident for tax purposes is completely different to being resident or non-resident in the country **

That is, in fact, exactly the reason why i want to be cautious about this.

markpb

anto9 wrote: »

Just pay your rent soft lad ,and stop worrying about the LL obligations .

If your landlord is tax resident abroad, it is the *tenants* obligation to pay tax to revenue, not the landlords.

anto9

markpb wrote: »

If your landlord is tax resident abroad, it is the *tenants* obligation to pay tax to revenue, not the landlords.

Thats a mad situation .In that case as i would still be paying the rent ino the Landlords Irish bank a/c ,i would just deny any knowledge of the LL being abroad .

djimi

anto9 wrote: »

Thats a mad situation .In that case as i would still be paying the rent ino the Landlords Irish bank a/c ,i would just deny any knowledge of the LL being abroad .

Under normal circumstances you cant; not if the landlord has provided you with their address as they are legally obliged to do (its normally on the lease).

However, in this situation its pretty much exactly what Im suggesting the OP do. Unless Threshold advise otherwise of course.

floralys

Thanks all. Threshold thinks (but they don't really deal with tax issues) that it doesn't matter what the tenant thought/thinks or what is on the lease, what matters is whether the LL is resident or not. It is up to the tenant to find out this information.
I expect that if it came down to it, I would win a case so I wouldn't have to pay that tax, but I have no desire to deal with some long-drawn out process and want to deal with it now.
I am waiting to hear back if the LL is tax resident in Ireland or not and then I will take it from there.

djimi

floralys wrote: »

Thanks all. Threshold thinks (but they don't really deal with tax issues) that it doesn't matter what the tenant thought/thinks or what is on the lease, what matters is whether the LL is resident or not. It is up to the tenant to find out this information.

I would strongly disagree with this tbh. What do they expect the tenant to do; write a weekly letter to the landlord to confirm that they are still living in the country? The landlords address is written on the lease. Legally they must inform you in writing of any change of address. Therefore if you recieve no written notice of a change of address then you are perfectly within your rights to assume that they are still resident at the address which they originally gave you.

gmisk

I have had a non resident landlord for about a year (lived in the house about 4 years).
I just rang revenue and they deducted the 20% at source no issues at all.

floralys

gmisk wrote: »

I have had a non resident landlord for about a year (lived in the house about 4 years).
I just rang revenue and they deducted the 20% at source no issues at all.

Could you elaborate on this please? I.e. what source do you mean and if it was that unproblematic why doesn't everyone do it? Thanks.

@djimi, do you have a link to this legislation? I don't want to contest it after the statement if you know what I mean, nor do I want to 'lie' when filing.

RATM

anto9 wrote: »

Just pay your rent soft lad ,and stop worrying about the LL obligations .

That's crap advice, you really shouldn't talk about things you know nothing about.

Because the legislation clearly states that if the tenant does not deduct the 20% then Revenue can then hold the tenant liable for the money and pursue them for it.

So before you open your mouth with bad advice that could see the OP being pursued by Revenue check your facts.

gmisk

floralys wrote: »

Could you elaborate on this please? I.e. what source do you mean and if it was that unproblematic why doesn't everyone do it? Thanks.

@djimi, do you have a link to this legislation? I don't want to contest it after the statement if you know what I mean, nor do I want to 'lie' when filing.

I contacted revenue directly.
My rent was 500 euro (per month) paid directly to the landlord. It is now 400 euro per month with revenue deducting 20% at source.
I do this as do my two flatmates.

Chris_5339762

How do they deduct it at source if, presumably, you just have a standing order set up for the rent transfer?

gmisk

No revenue deduct it from my wages at source, I then pay 400 euro per month directly to landlord.

sunnysoutheast

Chris_5339762 wrote: »

How do they deduct it at source if, presumably, you just have a standing order set up for the rent transfer?

The revenue adjust the tenant's tax bands to collect the 20%.

anto9

RATM wrote: »

That's crap advice, you really shouldn't talk about things you know nothing about.

Because the legislation clearly states that if the tenant does not deduct the 20% then Revenue can then hold the tenant liable for the money and pursue them for it.

So before you open your mouth with bad advice that could see the OP being pursued by Revenue check your facts.

I am just giving my opinion .I have been both Landlord ( in Ireland ) and tennant abroad .