Landlord tax

snoopmadra

Hi,

I live in Canada and have bought a house here to rent. What tax am I liable for? Rent will be around 1K per month.

Thanks.

adrianw

Here - as in Ireland?

Tenants will be obliged to withhold 20% of the rent unless you appoint an Irish resident agent.

As the property is based here and rent is circa EUR12,000 the Irish Revenue will tax you on profits at standard rate plus USC.

snoopmadra

Yes here as in Ireland. If we appoint an Irish resident agent, and have rent paid into Irish account we can pay our own taxes? The mortgage will be 500 and rent 1K so profit per month will be 500 gross.

Alan Shore

snoopmadra wrote: »

Yes here as in Ireland. If we appoint an Irish resident agent, and have rent paid into Irish account we can pay our own taxes? The mortgage will be 500 and rent 1K so profit per month will be 500 gross.

No the profit is the rent less 75% of the interest and lettings fees, repairs ect.

You get 12.5% annual capital allowances on fixtures and fittings.

The profit after capital allowances is subject to 20% tax.

Geuze

snoopmadra wrote: »

Yes here as in Ireland. If we appoint an Irish resident agent, and have rent paid into Irish account we can pay our own taxes? The mortgage will be 500 and rent 1K so profit per month will be 500 gross.

I'm amazed that people spend 100k-200k on investment properties to rent out, yet don't know how rental income is taxed.

The classic mistake, seen here, is to think that the mortgage repayment can be deducted from the gross rental income.

One might assume that after the severe financial crisis, people would be much better informed.

snoopmadra

Geuze wrote: »

snoopmadra wrote: »

Yes here as in Ireland. If we appoint an Irish resident agent, and have rent paid into Irish account we can pay our own taxes? The mortgage will be 500 and rent 1K so profit per month will be 500 gross.

I'm amazed that people spend 100k-200k on investment properties to rent out, yet don't know how rental income is taxed.

The classic mistake, seen here, is to think that the mortgage repayment can be deducted from the gross rental income.

One might assume that after the severe financial crisis, people would be much better informed.

Add your reply here.

One likes to amaze

Teeley

Alan Shore wrote: »

No the profit is the rent less 75% of the interest and lettings fees, repairs ect.

You get 12.5% annual capital allowances on fixtures and fittings.

The profit after capital allowances is subject to 20% tax.

Is there a limit on the number of years you can claim capital allowances??

relax carry on

Teeley wrote: »

Is there a limit on the number of years you can claim capital allowances??

Capital Allowances are typically claimed over 8 years. That's what gives you the 12.5% figure every year. It's 100% of the coat spread over 8 years.

corglass

Alan Shore wrote: »

No the profit is the rent less 75% of the interest and lettings fees, repairs ect.

You get 12.5% annual capital allowances on fixtures and fittings.

The profit after capital allowances is subject to 20% tax.

Alan,

thanks for this. Can you give a worked example for everyones benefit please?


thanks