Landlord/ Regulations

rooster00

I've a spare room at the back of my house which is currently used for storage. I'll be clearing it out over the coming weeks and I'm considering renting the room out. I was wondering what are the regulations for a self contained unit.

I already have a toilet downstairs and the occupant could have shared use of my kitchen and bathroom for cooking and washing purposes. They could enter from the side entrance of the property and come in through my back door, which is directly beside the door to the back room. It is a double room, about 100 sq ft.

My question is would this fall under a self contained unit or would it be a room, living in shared accommodation with the landlord.

I am in a position to the extend the room to include space for a private washroom and cooking facilities if needs be to fall under the self contained unit regulations. To do this must I also have a separate entry way into the unit or could I continue to allow the use of entry through the side of my property, with use of the back door to gain entrance to the unit.

The_Conductor

If you are letting a room in your residence- where the room has contigious access to the rest of the house- you are letting the room under licence- and the person who takes the room, is a licensee, and not a tenant, and they (and you) are not subject to the Residential Tenancies Act.

In addition- you can earn up to 14k letting a room (or multiple rooms) in your dwelling like this- however this 14k is the gross (i.e. it includes any contributions towards bill shares etc).

If you make it into a self contained unit- you run the risk of the person letting it arguing that they are a tenant and subject to the RTA- in addition to the fact that letting a property to a tenant is taxed at your marginal rate of tax- whereas the rent-a-room scheme is 14k per annum, tax free, regardless of any other income you may have from elsewhere (of course- it only relates to letting a room in your principle private residence- no other property).

rooster00

The_Conductor wrote: »

If you are letting a room in your residence- where the room has contigious access to the rest of the house- you are letting the room under licence- and the person who takes the room, is a licensee, and not a tenant, and they (and you) are not subject to the Residential Tenancies Act.

In addition- you can earn up to 14k letting a room (or multiple rooms) in your dwelling like this- however this 14k is the gross (i.e. it includes any contributions towards bill shares etc).

If you make it into a self contained unit- you run the risk of the person letting it arguing that they are a tenant and subject to the RTA- in addition to the fact that letting a property to a tenant is taxed at your marginal rate of tax- whereas the rent-a-room scheme is 14k per annum, tax free, regardless of any other income you may have from elsewhere (of course- it only relates to letting a room in your principle private residence- no other property).

So if I were to extend to make the room into a self contained unit with its own access I would not qualify for any tax free income gained from the rental of it?

Reason this is bothering me is I'd be open to letting it to a HAP tenant, but it is my understanding they would only be entitled to €430 per month from DCC as it'd be a room in shared accommodation, whereas an individual is entitled to €792 if it is a self contained unit.

Gumbo

rooster00 wrote: »

So if I were to extend to make the room into a self contained unit with its own access I would not qualify for any tax free income gained from the rental of it?

Reason this is bothering me is I'd be open to letting it to a HAP tenant, but it is my understanding they would only be entitled to €430 per month from DCC as it'd be a room in shared accommodation, whereas an individual is entitled to €792 if it is a self contained unit.

Will you get planning permission for a self contained unit?

borderlinemeath

rooster00 wrote: »

So if I were to extend to make the room into a self contained unit with its own access I would not qualify for any tax free income gained from the rental of it?

Reason this is bothering me is I'd be open to letting it to a HAP tenant, but it is my understanding they would only be entitled to €430 per month from DCC as it'd be a room in shared accommodation, whereas an individual is entitled to €792 if it is a self contained unit.

IMO, the problem with a self contained unit in your situation is that you could end up in a position where you may not be in a position to evict an anti social or overholding tenant, from what is effectively your home - albeit a self contained unit, but attached to your home. Think gardens, driveway access, refuse collections etc and how you could be negatively affected.

You'll get less rent for a room rental, but you have the 14k tax free income threshold. A lot less hassle than setting up and maintaining a self contained unit.

rooster00

kceire wrote: »

Will you get planning permission for a self contained unit?

Would I need it? I'd only be extending the property by about 4x10 ft. What are the regulations on extending property?

rooster00

borderlinemeath wrote: »

IMO, the problem with a self contained unit in your situation is that you could end up in a position where you may not be in a position to evict an anti social or overholding tenant, from what is effectively your home - albeit a self contained unit, but attached to your home. Think gardens, driveway access, refuse collections etc and how you could be negatively affected.

You'll get less rent for a room rental, but you have the 14k tax free income threshold. A lot less hassle than setting up and maintaining a self contained unit.

I already have a tenant in mind and they're trustworthy. We are quite close friends, so I wouldn't be worried about anything going sour.

wordofwarning

rooster00 wrote: »

I already have a tenant in mind and they're trustworthy. We are quite close friends, so I wouldn't be worried about anything going sour.

And what happens if in a years the housing crisis gets worse and you have found an ideal partner who does not want to share a house with someone. There is a high risk of that 'friend', choosing to stay in that property without your permission than living in limbo ie finding it very difficult to find a home

HAP has a lot of rules and regs. Getting your 'unit' to the regs might might eat up all the extra income you are aiming to get from it. Plus if you are making it a self-contained unit, you might be losing rent-a-room scheme. So all the extra income will just be going to Revenue

The_Conductor

rooster00 wrote: »

Would I need it? I'd only be extending the property by about 4x10 ft. What are the regulations on extending property?

Creating a separate self contained unit- may require planning permission- wholly aside from the fact that your proposed extension is below the planning threshold.

Personally- looking at this purely from a tax perspective- it makes no sense whatsoever to have this setup as a self-contained unit- in fact the idea is nutty. You can earn 14k, tax free, letting a room in your home. If its a self contained unit- you face the prospect of paying tax on the entirety. It just doesn't make sense.

pocketse

As far as i am aware it is still considered part of the house if there is access from the house. For example, if you had an independent entrance for the unit but there was also an internal door that connected it to your main residence, even though it may be locked it is still part of the house and not a completely independent unit.

The_Conductor

The_Conductor wrote: »

Creating a separate self contained unit- may require planning permission- wholly aside from the fact that your proposed extension is below the planning threshold.

Personally- looking at this purely from a tax perspective- it makes no sense whatsoever to have this setup as a self-contained unit- in fact the idea is nutty. You can earn 14k, tax free, letting a room in your home. If its a self contained unit- you face the prospect of paying tax on the entirety. It just doesn't make sense.

Once the self contained until is part of the main property and has direct internal access (even if its a permenantly locked door) its still rent a room and tax free up to 14k and the person living there will still be a licensee.

It's pretty much the ideal scenario, not really sharing your home but getting all the benefits of rent a room.

rooster00

Having considered the options and done more research into them, I'm aiming more towards the rent a room option so as I can also avail of the tax relief. There is one more thing I'm unsure of though in this situation would it be possible to let to a HAP tenant? And if so is there any stipulations on what facilities should be provided for them, as in must they have their own kitchen/washroom facilities in their room or can they have shared use of my kitchen and bathroom.

Askthe EA

rooster00 wrote: »

Having considered the options and done more research into them, I'm aiming more towards the rent a room option so as I can also avail of the tax relief. There is one more thing I'm unsure of though in this situation would it be possible to let to a HAP tenant? And if so is there any stipulations on what facilities should be provided for them, as in must they have their own kitchen/washroom facilities in their room or can they have shared use of my kitchen and bathroom.

HAP housing must be up to 2017 standards. If you accept HAP on a 'house share' the whole house will need to be up to standards. There MIGHT be a large bill depending on the age of the house.

rooster00

Askthe EA wrote: »

HAP housing must be up to 2017 standards. If you accept HAP on a 'house share' the whole house will need to be up to standards. There MIGHT be a large bill depending on the age of the house.

Do you know what these standards are?

Askthe EA

If you Google minimum housing standards you'll find them. Ventilation seems to be the costly one if it isn't already there.