Rent relief with non resident landlord

hmez3

Hi,

I have been renting accommodation for almost a year and I decided to claim rent relief. I pay the full rental fee directly into my landlords account every month, he used to live in the house a few years ago but is now living in England (non-resident). I have never met him (although he called on one occasion when we weren't there) so I emailed for his PPS no. and told him that I was planning on claiming rent allowance. I had read about the 80% to the landlord and 20% in tax to the revenue, but I figured since he was giving me his PPS and he knew I was applying, that everything was above board and that he was paying the 20% tax on the rent money. It now turns out that rather than getting some money back like I had hoped I actually owe nearly €500. I contacted my landlord about the matter, saying that when he gave me a set figure for rent he never mentioned anything about having to pay extra on tax, or when I contacted him for his PPS he never said that he hadn't been paying tax and that I could be liable. He knowingly let walk right into it and then told me to
'Please feel free to find accommodation elsewhere if you don't agree with paying the tax that is owed.'
I feel that this is very unfair as I had no way of knowing, and I am wondering if there is anything I do. I can not afford to pay this money. Am I within my rights to only pay him 80% of the rent form now on?

djimi

Were you aware that the landlord is not living in Ireland when you signed the lease? If so then it was up to you to start witholding the tax from the start. The tax is not an extra amount on top of the rent; you pay the landlord 80% of the agreed rental rate and the other 20% you set aside to pay the tax.

The tax is due on the yearly rate as far as Im aware, so if you have been renting for 10 months and not witholding the tax then you would need to withold the entirety of the remaining two months rent in order to pay the tax owed. This should see you even (the landlord would have recieved 80% of the yearly rental rate and you have the other 20% to pay as tax).

lovelyjubbly

Can you take it out of future rent payments?

hmez3

Thanks for the quick response.
It was another housemate that had put the add up on daft.ie, it was her that showed me the house and told that me the rent was €220 a month as on Daft.ie, she also told me that the landlord was lived in England and that I would probably never see him, so I was aware that he lived in England when I moved in, not that I thought it would make any difference at the time, but there was no lease, I have never got or signed anything!!! I'm sure he also told me the rent was 220 when I emailed him to get his bank details to set up a direct debit.

You say the tax is not an extra top up of the rent, therefore I should only pay him 80% of the AGREED rate of €220, is this just your opinion or is there some sort of legal documentation I can get to send him to back it up, apart from the very basic explination on the revenue website. That was my initial idea, to withhold two months rent so that we would be even, but I don't know what legal repercussions if it this was not legal. I know my landlord wouldn't be too happy.

Like its all good and well to say just don't pay him for to months, and then continue on as normal (or move out which would be more likely), but couldn't he just evict me in the meantime, I don't know what right I have to do that.

lovelyjubbly

If the LL said the rent is x amount then that is what the rent is. Deduct 20% from that and this is the future amount you pay in tax. I would also deduct monies owed from the rent to pay the amount already owed.

http://www.threshold.ie/advice/tenancy-issues/tax-obligations-of-tenants-whose-landlord-lives-ab/

http://www.citizensinformation.ie/en/housing/renting_a_home/tax_relief_for_tenants.html#le9d7d

I would tell the LL you are doing this (preferably by email so you can prove it, I also wouldn't answer the phone to him to try and force him to respond by email).

If he tries to evict you over this it is an illegal eviction and you can challenge this. Unless he's going to come over here.

Is this a shared tenancy? I am unsure if Part 4 covers shared accom but if it does then he cannot legally evict you over this.

http://www.citizensinformation.ie/en/housing/renting_a_home/types_of_tenancy.html

I find it's better to speak to someone so perhaps going to a FLAC or citizens info centre would help clarify this issue?

TheBandicoot

Information here : http://whatsnew.citizensinformation.ie/2011/03/21/know-your-rights-paying-rent-to-a-non-resident-landlord/


It's a really really awful system. I suspect none of you involved(yourself, the landlord and the previous tenant) had any idea of this requirement. I suggest informing the landlord of the obligation.

Ideally, the landlord should return you 20% of the rent he has received so far and you can pay that to the Revenue to satisfy them; or you withhold the rest of the rent if it comes to enough to pay 20% of the annual rent and pay that to the revenue once you have it saved up. If the landlord complains in the second instance, well you're in the right, so stick to your guns.

hmez3

In an email to my landlord I basically said (in more polite words) that by law I was supposed to be paying 80% of the original price €220 to him and 20% (€44) to the gov every month, instead I was giving him 100% and now the gov wants their 20% which over 10 months comes to 440 of my money, that he has, that i now need to give to the gov. As long as I know that I am within my rights to with hold two months rent (€440), that is what I will do, I will let him know in advance and I will keep a paper trail of all our conversations.

Lovely Jubly: It is shared tenancy so I not sure either whether I'm covered under part 4. If I am it means that because I am living there over a year in March, i will need 42+ days notice of eviction, which is almost two months, so it will tie in nicely with the plan to with hold rent, if he does lose the head and decide to evict me.

I will get on to the FLAC and citz info beforehand just to be sure.

Thanks for all the info, ye'v given me a bit more courage!!!

Pawwed Rig

Hi OP

Some accurate advice been given so far. I have nothing more to add really only that maybe give Revenue a call and they will verify everything that has been said so far.

Just so you are sure, 6you withholding 20% and paying it to Revenue is provided for under section 1041 and section 238 of the Taxes Act. Under section 238 the landlord must allow the deduction.

Annual payments are allowable by Revenue so no need to do it monthly. You should give the landlord a Form R185 which he can then forward onto Revenue.

As another poster says if the landlord kicks up a fuss and threatens to evict you this will be an illegal eviction and you will have a strong case in any subsequent case with the PRTB. You should probably look into your lease arrangements and see if you are entitles to a Part 4 tenancy which will make you more secure.

So I would withhold further rent payments until the 20% has been reached. After you pay the money to Revenue you should then receive your refund (if due) for the rent relief.

It is the first time I have heard Revenue chasing a tenant for this money so if you can keep us informed of how you get on I would be interested.

Good luck

xper

hmez3 wrote: »

It is shared tenancy so I not sure either whether I'm covered under part 4. If I am it means that because I am living there over a year in March, i will need 42+ days notice of eviction, which is almost two months, so it will tie in nicely with the plan to with hold rent, if he does lose the head and decide to evict me.

Accommodation shared with other tenants (i.e., not shared with the homeowner) is most definitely covered by a Part 4 tenancy.


Also, do not confuse a Notice of Termination of tenancy with an Eviction. They are very different things.

Under a Part 4 tenancy, a Notice of Termination can normally only be issued by a landlord for one of six specific reasons (of which "losing the head" is not one) and the period of notice required depends on the length of the tenancy (which is where you are getting your 42+ days from). A Notice of Termination can also be issued if you breach a condition of the lease. This notice period will be 28-days (or 7-days in the case of anti-social behaviour). It must be preceded, however, by a written warning that specifies the breach and gives you reasonable time to correct the problem (14 days for in the case of failure to pay rent).

An Eviction is an entirely different exercise and implies you have been very naughty. An eviction from rental accommodation can only legally occur on foot of a Court Order issued for enforcement of a PRTB Determination Order that you have failed to comply with a valid Notice of Termination. It is a serious last resort at the end of a very long legal path for what would be, at that stage, a very cheesed off and out-of-pocket landlord.

I'm labouring the point but I just have visions of you ringing another landlord in the future to arrange a viewing of a possible future home and, when he asks why you're moving, you say you've been evicted..... *click*... Hello? Hello?