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Rental Income

  • 19-10-2017 10:26am
    #1
    Shurwhynot
    Registered Users, Registered Users 2 Posts: 561 ✭✭✭


    If someone bought a property in Ireland using a loan received in another country, can the interest paid on that loan be used when calculating rental profit? Rent received through Airbnb lettings


Comments

  • #2
    gerrybbadd
    Registered Users, Registered Users 2 Posts: 10,301 ✭✭✭✭gerrybbadd


    Shurwhynot wrote: »
    If someone bought a property in Ireland using a loan received in another country, can the interest paid on that loan be used when calculating rental profit? Rent received through Airbnb lettings

    Interest is only deductible as an expense where the property is registered with the PRTB. And it's only 75% of the interest allowed.


  • #3
    Peregrinus
    Registered Users, Registered Users 2 Posts: 26,998 ✭✭✭✭Peregrinus


    Plus, it has to be interest on a loan secured by a mortage on the rented property.


  • #4
    CIARAN_BOYLE
    Registered Users, Registered Users 2 Posts: 14,599 ✭✭✭✭CIARAN_BOYLE


    gerrybbadd wrote: »
    Interest is only deductible as an expense where the property is registered with the PRTB. And it's only 75% of the interest allowed.

    Does revenue holds that airb&b income is case i. If so the inteest would be allowable without prtb registration.


  • #5
    exaisle
    Registered Users, Registered Users 2 Posts: 2,675 ✭✭✭exaisle


    Peregrinus wrote: »
    Plus, it has to be interest on a loan secured by a mortage on the rented property.

    Does it?

    From the Revenue website:
    "The interest must be from a mortgage that is used to purchase, improve or repair your rental property."

    This doesn't mention on which property the mortgage is secured. If somebody extends the mortgage on their principal private residence to make up the cost of purchase of a rental property, then isn't that interest allowable too?


  • #6
    exaisle
    Registered Users, Registered Users 2 Posts: 2,675 ✭✭✭exaisle


    CIARAN_BOYLE wrote: »
    Does revenue holds that airb&b income is case i. If so the inteest would be allowable without prtb registration.

    If it's case I, is there still a 75% restriction? Just askin', like...


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  • #7
    CIARAN_BOYLE
    Registered Users, Registered Users 2 Posts: 14,599 ✭✭✭✭CIARAN_BOYLE


    exaisle wrote: »
    If it's case I, is there still a 75% restriction? Just askin', like...

    There's no 75% restriction to short term let businesses like hotels and b&b. Why would there be in a air b&b.

    It is an argument I have successfully advanced in a revenue audit.

    I haven't worked in tax in a year so I don't know if there have been any developments in the treatment of airb&b or more upto date caselaw changing the interpretations we relied upon.


  • #8
    exaisle
    Registered Users, Registered Users 2 Posts: 2,675 ✭✭✭exaisle


    CIARAN_BOYLE wrote: »
    There's no 75% restriction to short term let businesses like hotels and b&b. Why would there be in a air b&b.

    It is an argument I have successfully advanced in a revenue audit.

    I haven't worked in tax in a year so I don't know if there have been any developments in the treatment of airb&b or more upto date caselaw changing the interpretations we relied upon.

    Thanks for that...good to know that it's been tested during a revenue audit.

    There's no justification for the 75% restriction anyhow...but I can think of a few people who might be tempted to go down the Airbnb route (legally!)


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