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IT on mortgage for Mother?

  • 14-05-2018 9:15am
    #1
    heretothere
    Registered Users, Registered Users 2 Posts: 635 ✭✭✭


    Basically, my mam is 52 and as such is only going to qualify for a short mortgage. I could get out a longer mortgage based solely on my income. She would be paying back the mortgage though (appreciate once she's at retirement I'll prob have to take over a decent amount of the repayments).

    So would it technically be my house and would I be subjected to income tax on the 'rent'? My tax credit/ band is fully used up so you'd be looking at 52% tax on the 'rent'. Both our names would be on the house but only myself on the mortgage.

    Thanks for any advice


Comments

  • #2
    [Deleted User]
    Posts: 5,121 ✭✭✭ [Deleted User]


    I don't follow it?
    You are getting a mortgage on a house you won't be living in and your mother will be paying the monthly mortgage?

    Yes - if your mother is paying you an amount every month for the use of a house it might be seen as rent.

    Have you spoken to a solicitor or accountant about any of this?

    You are unlikely to get a mortgage in your own name only on a house that is partly owned by you and your mother.


  • #3
    heretothere
    Registered Users, Registered Users 2 Posts: 635 ✭✭✭heretothere


    I done my training in a practice and I'm still in touch with a few of the tax consultants just wanted to try get a better idea myself, this isn't a situation I've come across before.

    My mam has found herself in a situation that at 52, she does not own a house and needs to buy one before retirement. As I highly doubt the state pension will cover her rent. She lives down the country so my wage alone will be enough to draw down a loan to buy a small house. Ideally I would like to get a mortgage for 20 years however, due to her age if we both go on the mortgage the longest she seems to be able to get is around 10 years.

    I could subsidise the mortgage a small bit, we can get a 13 yr mortgage in both of our names then jointly buy the house. It's more than she can afford but I'd prefer the be paying a bit towards the mortgage than for the whole mortgage to be in my name on a longer term as I am sure that would make me liable to IT, as the mortgage would be in my name and most likely the house would be too. Which would mean 1/2 of the 'rent' she would be paying me would go to revenue which I really can't afford!

    Edit - rang AIB the only way to have her on the deed is if she is on the mortgage and the only way to have her on the mortgage is to take a 13yr mortgage. Or I take the mortgage myself, buy the house in my name and she pays the mortgage which as far as I am aware would mean that I would be liable to IT on the 'rent' aka mortgage repayments which would cost me a fortune. So guess it's option no one


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