Trouble with tenant

AusVisa123

Hi guys so I'm having a spot of bother with my tenants, they moved into my house around 2 years ago. Rent was 650 and I reduced it to 600 after a few months as I knew the family that moved in kinda and they were good. They always said they would only be staying a year or so as there buying a house.

But its 2 years later and now houses are going for 800euro, I messaged them 3 months ago saying I was putting rent up to 675 still well under going rates and i wanted to give them plenty of time to look elsewhere etc. 3 months has passed and they still paid only the 600. I reminded them 2 weeks ago.

So I text them the day that 600 was only paid and said it nicely but gave them 3 months notice etc. She then replied with "wow you will be receiving a letter from my solicitor shortly"

For starters I dunno what ground she is on about. I've been nothing but nice to these people.

I'm just wondering what's my best move now? They didnt sign a agreement as I knew them and didnt think would have to. She is expecting and they have 2 other kids around 10 yr and 15yr old.

Thanks

(I'm a regular on this forum just rather stay annom)

endacl

Didn't sign an agreement, and communicated by text?

You know there are simple downloadable forms available to landlords that make these situations entirely avoidable? I'm afraid you've dug yourself a bit of a hole.

martinr5232

No good deed ever goes unpunished as they say. First mistake you made was thinking they were nice people.
You need to if its not already register the tennancy with ptrb then make sure your taxes are in order. Sorry i cant help you anymore but you should probably expect a bit of a fight to get them out so you need to do everything by the book.

Axwell

You need to clarify a few things, was there any lease agreement signed ever?

When you text about this rise in rent did they acknowledge it or communicate with you about it?

As above poster says you have dug a bit of a hole but you arent giving all the info either to paint the full picture.

AusVisa123

No there was never a tenancy signed, I know I have went about things the wrong way. I dont know what they will do now that's all I got "expect a letter from my solicitor" so obviously they have already sought advice I take it.

Can they just stop paying rent?

I dont understand what the letter means from their solicitor, as I havent done anything. What could it be about?

Graces7

AusVisa123 wrote: »

No there was never a tenancy signed, I know I have went about things the wrong way. I dont know what they will do now that's all I got "expect a letter from my solicitor" so obviously they have already sought advice I take it.

Can they just stop paying rent?

I dont understand what the letter means from their solicitor, as I havent done anything. What could it be about?

That could be just an empty threat to scare you off; seems to be effective.

Call Threshold?

AusVisa123

Yes it may well be a empty threat as I cant possibly think of what they could do to me getting a solicitor involved. I'm in Australia for the year, So I cant do much here and my parents are over visiting.. So I will leave it for now and not contact them again and when my dad goes home he will go in to have a chat with them.

I wonder if they will pay next months rent now or what there intentions are. I guess I just have to wait to find out.

Axwell

So if there is no agreement is the tenancy registered with the prtb?

You will have no chance of enforcing anything that was agreed by text in terms of a rent increase and should have done so by letter.

Its unlikely you will hear from their solicitor but if you do it will most likely say you have not given appropriate notice of a rent increase by letter in the post and that your texts are irrelevant. Any further communication from you should be done by post regarding remt etc.

uck51js9zml2yt

Just to add. Use registered post.

troyzer

A €75 euro increase is 12.5%.

Is it in an RPZ?

Even if it's not you have to give it to them in writing, preferably by registered post.

You're also legally required to give them 90 days notice so you shouldn't feel like you were doing them a favour.

AusVisa123

Thanks for all advice I'm getting.

No it's not registered with PTRB , I will have to get that in order now.

I guess the best next move is wait until my dad talks to them when hes home in 2 weeks.

I just want them out of my house now after this messing about. Ive been more than good to them throughout tenancy and even though I'm increasing rent 75euro monthly, let's not forget I decreased it 50 after a few months into tenancy it's still well below market value.

Since I have no tenancy agreement or registered prtb how difficult would it be for me to send them eviction notice and if they didnt comply to have them removed?

troyzer

AusVisa123 wrote: »

Thanks for all advice I'm getting.

No it's not registered with PTRB , I will have to get that in order now.

I guess the best next move is wait until my dad talks to them when hes home in 2 weeks.

I just want them out of my house now after this messing about. Ive been more than good to them throughout tenancy and even though I'm increasing rent 75euro monthly, let's not forget I decreased it 50 after a few months into tenancy it's still well below market value.

Since I have no tenancy agreement or registered prtb how difficult would it be for me to send them eviction notice and if they didnt comply to have them removed?

Doesn't matter if it's in an RPZ.

I'm not sure what happens now if it's not registered with the PRTB and with no lease? Does anybody know? Do they have part four anyway?

Chasing this when you're not registered or have all of the proper paperwork might blow up for you.

AusVisa123

troyzer wrote: »

A €75 euro increase is 12.5%.

Is it in an RPZ?

Even if it's not you have to give it to them in writing, preferably by registered post.

You're also legally required to give them 90 days notice so you shouldn't feel like you were doing them a favour.

It's not RPZ, I gave them 3 months notice by text of rent increase or 6 months to find a new place and keep rent at 600.. that was 3 months ago..

If they now make me send them a letter for 90 days notice I may as well make the rent market value at 750 - 800 if they want to be like that.

troyzer

AusVisa123 wrote: »

It's not RPZ, I gave them 3 months notice by text of rent increase or 6 months to find a new place and keep rent at 600.. that was 3 months ago..

If they now make me send them a letter for 90 days notice I may as well make the rent market value at 750 - 800 if they want to be like that.

A text doesn't count as written notice.

You could increase it to that much if you wanted. But they might have you by the balls seeing as how you never registered the tenancy.

Axwell

AusVisa123 wrote: »

It's not RPZ, I gave them 3 months notice by text of rent increase or 6 months to find a new place and keep rent at 600.. that was 3 months ago..

If they now make me send them a letter for 90 days notice I may as well make the rent market value at 750 - 800 if they want to be like that.

This is all irrelevant - you didnt do any of it through the proper channels. A text is not vaild so you may as well not have ever sent it in the first place.

The attitude of ‘if they want to be like that’ will get you nowhere either. If you approach things that way you will find yourself in a very long drawn out case and things wont be in your favour because you failed to do things properly to begin with.

If they are there between 1-2 years then the number of days required is 42 days but you have to have grounds to terminate the tennancy under part 4 - you dont have any at the minute based on what you posted.

https://www.threshold.ie/advice/ending-a-tenancy/how-your-landlord-may-end-your-tenancy/

A civil chat with them might be the best place to first start since you havent got any proper agreement in place and its not registered with the prtb. If that doesnt go anywhere then you are going to have to get your stuff in order registering with the prtb and go from there.

AusVisa123

I understand, thanks for your help all.

I will update in 2 weeks after my dad has a chat with them.

Thanks

punisher5112

You need to stop texting and issue with correct notice by post and you could hand deliver also but as suggested use registered post for everything.

It's the RTB now they dropped the P.

Are you tax compliant?

You need to get it registered ASAP.

If you go over or send your dad be very careful as they may build a case against you for harassment or just end up stop paying any rent at all.

You will find it very difficult and expensive to get them out if payment stops as could take a year or more while you get nothing.

Try and explain nicely if you can and in your rent increase letter show proof of other similar properties in the area going for the higher rate and show you aren't looking for the same thing.

Just do it by the book and don't deviate.

endacl

Graces7 wrote: »

Call Threshold?

Don’t call Threshold, OP.

Grace says mad stuff. It’s kind of her job on here.

AusVisa123

To be honest no I'm not fully tax compliant as this is my primary residence and have rented it and moved to Australia to help me clear arrears which I have and help pay off a good chunk of mortgage before moving home. I bought house young and lived in it up until 2 years ago when recession hit it hit me but now I'm trying to make up for it and just as I'm back on track I have hit another obstacle that I could do without as if things werent stressful enough.

I may be reading into it too much but the fact she sent the message "expect a solicitors letter" I know this now can set very messy for me. But there no saints either, they have 2 northern cars parked at my house she was doing cash in hand while receiving benefits. But look I dont want to go down this road. I will see how it plays out first.

amcalester

You're one the bad ones OP.

TheChizler

You need to register with the RTB, pay the late registration fee, and send a rent increase of the correct form with the correct notice. Bear in mind if they're paying rent direct to you they should legally be retaining 20% for Revenue as youre a non-resident landlord.

FishOnABike

One other thing which has not been mentioned is that since you are living abroad, the tenant should be withholding 20% of the rent and paying it to the revenue commissioner, that is unless they are paying it to an agent in Ireland.

The tenant then returns a R185 form to revenue at the end of the year to record the withholding tax paid on your behalf.

It might be worth having your father or someone else in Ireland act as agent to receive your rent and also file your tax return for any rental income. Your agent would also manage your tax on your rental income. This would avoid depending on your tenant to ensure your tax is in order.

sweetie

This is the kind of crap that gives decent landlords a bad name, picking and choosing the parts that suit you. It will likely be an expensive lesson to learn.

SusanC10

OP - you need to correct how you have been handling things.

Register with the RTB. Pay the late fee.
Sort out your Income Tax situation in Ireland.
Part IV already applies here so only certain set reasons are permitted to end the tenancy.
If you want to increase the rent then do it properly in writing.

AusVisa123

Ok thanks guys I will look into all of this.

Ok obviously I'm due them few comments but I'm not really a landlord as such. I got into difficulty and made some decisions while you think it's bad.

I think it's bad when someone has the money but chooses not to pay mortgage as they know they wont be evicted etc.

I may not have went about this the right way, I only made the decision to move out of my house for a few years and go to Australia to help me pay my mortgage. I've paid tax working all my years. I wasnt avoiding this tax. To be honest I just never thought too much about it and I hate paperwork.

I will look into correcting it now.

m5ex9oqjawdg2i

AusVisa123 wrote: »

Ok obviously I'm due them few comments but I'm not really a landlord as such. I got into difficulty and made some decisions while you think it's bad.

You are renting out your house to somebody but you are not a landlord? What category do you fall into? I am interested to hear.

gmisk

AusVisa123 wrote: »

Ok thanks guys I will look into all of this.

Ok obviously I'm due them few comments but I'm not really a landlord as such. I got into difficulty and made some decisions while you think it's bad.

I think it's bad when someone has the money but chooses not to pay mortgage as they know they wont be evicted etc.

I may not have went about this the right way, I only made the decision to move out of my house for a few years and go to Australia to help me pay my mortgage. I've paid tax working all my years. I wasnt avoiding this tax. To be honest I just never thought too much about it and I hate paperwork.

I will look into correcting it now.

Your 'not a landlord as such' .... I am sorry but you are renting out a property to someone for money....so how are you not a landlord?
You have made a hash of this, sounds like you will hopefully learn a lesson from this at least.

The J Stands for Jay

AusVisa123 wrote: »

I've paid tax working all my years. I wasnt avoiding this tax. To be honest I just never thought too much about it and I hate paperwork.

I will look into correcting it now.

You mean you've only paid the tax that someone else has already taken from you, you haven't actually paid all the taxes you should have paid.

SusanC10

AusVisa123 wrote: »

Ok thanks guys I will look into all of this.

Ok obviously I'm due them few comments but I'm not really a landlord as such. I got into difficulty and made some decisions while you think it's bad.

I think it's bad when someone has the money but chooses not to pay mortgage as they know they wont be evicted etc.

I may not have went about this the right way, I only made the decision to move out of my house for a few years and go to Australia to help me pay my mortgage. I've paid tax working all my years. I wasnt avoiding this tax. To be honest I just never thought too much about it and I hate paperwork.

I will look into correcting it now.

Look OP, I understand that you were under pressure but you seem to have made big life decisions without looking into the legal/tax/other consequences of doing so.

Please don't put your head in the sand on this. Take the steps to correct things now.

AusVisa123

Look it wasnt the tax issue I was avoiding, It was the fact that it's my primary residence, I felt if I declare it as being buy to let my mortgage would change and I didnt want to get into all of that. It's not big money were talking.

Right maybe I've went about this the wrong way. I bought my house the year before the big crash. At one stage it was under half the value of what I paid for it. I continued paying my mortgage even though I could have thrown the keys back but accept I owe the money. I fell into some arrears throughout the year but have it fully rectified now. I never got a deal either or a write off which some people have. My mortgage outstanding to this day is still about 20% above market value. So please dont slate me without knowledge of what I've been through. I'm trying to do the right thing I may have went about it wrongly.

The banks are screwing us, The governments. But that's another story. I'm just trying to get by. Maybe the best thing for me was to throw keys back. Then that's putting a hell of a lot back on the taxpayer anyway. Without talking houses I would be very surprised if everyone of you with the negative comments is 100% tax compliant in every area. I didnt realise not registering my tenancy was this bad. But as I said I will look into and sort it and do it right.

Graham

1) register the tenancy with the RTB, even with the late fee/penalty it's not much.
2) issue your tenant with a formal notice of rent increase with the appropriate notice period.
3) find an accountant to consult with.

When the rent increase comes into effect, you can follow the arrears process if the tenant fails to pay the increased rent.

Tip: Don't confuse the thread or yourself by throwing in rants about the government or the banks. They are entirely irrelevant to your current situation.

AusVisa123

SusanC10 wrote: »

Look OP, I understand that you were under pressure but you seem to have made big life decisions without looking into the legal/tax/other consequences of doing so.

Please don't put your head in the sand on this. Take the steps to correct things now.

I intend to thank you

Ray Palmer

AusVisa123 wrote: »

Look it wasnt the tax issue I was avoiding, It was the fact that it's my primary residence, I felt if I declare it as being buy to let my mortgage would change and I didnt want to get into all of that. It's not big money were talking.

Right maybe I've went about this the wrong way. I bought my house the year before the big crash. At one stage it was under half the value of what I paid for it. I continued paying my mortgage even though I could have thrown the keys back but accept I owe the money. I fell into some arrears throughout the year but have it fully rectified now. I never got a deal either or a write off which some people have. My mortgage outstanding to this day is still about 20% above market value. So please dont slate me without knowledge of what I've been through. I'm trying to do the right thing I may have went about it wrongly.

The banks are screwing us, The governments. But that's another story. I'm just trying to get by. Maybe the best thing for me was to throw keys back. Then that's putting a hell of a lot back on the taxpayer anyway. Without talking houses I would be very surprised if everyone of you with the negative comments is 100% tax compliant in every area. I didnt realise not registering my tenancy was this bad. But as I said I will look into and sort it and do it right.

You are basically saying you were willing to lie so as not to effect your mortgage. You haven't paid tax and revenue do care even if you think it is small money.
You effect the rental prices of others.You just didn't care about anybody but yourself

You couldn't have just thrown the keys back

California Dreamer

Great to see so many mightier than thou people here.

Guy made a mistake, looks for advice. Gets shot down!

Fian

OP:

you need to register this tenancy with RTB.

You need to make a tax declaration for the income. What year did you start renting it out? the pay adn file deadline for 2017 passed two weeks ago, but you should file and pay the late filing fee. If you rented it out ebfore that pay adn file for those years too. In that case you will probably also need an accountant.

Download the standard forms from the RTB one stop shop and give them proper notice of a rent increase through those forms. There is little point in sending your dad to talk to them after they have threatened a solicitor's letter.

If you are outside an RPZ you would probably be sensible to raise the rent to market rent, in case an RPZ is imopsed on your area. If it is the sale price (to investor purchasers) will be directly impacted by teh rent cap - below market value rents = below market value price, unless you are selling to someone who wants to live in the house themselves.

AusVisa123

Ray Palmer wrote: »

You are basically saying you were willing to lie so as not to effect your mortgage. You haven't paid tax and revenue do care even if you think it is small money.
You effect the rental prices of others.You just didn't care about anybody but yourself

You couldn't have just thrown the keys back

I'm sorry but your wrong with the last part, Yes I could have. I was with a PIP and had meetings with mortgage company. Never got a deal with bank but that part was on the table. I decided against it , Dont ask why cause I'm hitting my own head against the wall. I think all will fair out ok in the end, but I dont know if it's worth all the stress it has put me through, through the years owing so much money at such a young age. But I made that decision. I'm not trying to blame someone else. I have went about renting my house for the 2 years and next year until I move home the wrong way I understand that now.

I will look into accountant etc to get everything above board moving forward. I appreciate the advice I'm getting.

dennyk

Are you still residing in Australia? If so, the tenant is required to deduct 20% from their rent payment and remit it to Revenue on your behalf. Have they been doing this? Is the current €600 rent before or after that deduction?

You may still be able to fix things at this point, but it is going to cost you some money:

- Register the tenancy with the RTB and pay your late registration fee

- File your taxes and get current with Revenue, paying any late filing fees and interest on back taxes accordingly. And don't forget to get yourself squared away with the tax authorities in Australia regarding this rental income as well; you hopefully won't owe anything there thanks to tax treaties and such, but you may still need to file and report it regardless...

- If you still live abroad, notify your tenant that they must start deducting 20% of their rent payment and remitting it to Revenue to cover your taxes.. This means they will directly pay you 80% of their actual rent amount (e.g. €480 instead of €600 under their current rent). You will be able to claim a credit for the amount they remit to Revenue on your behalf when you go to pay your own taxes. In the end you may either still owe some money or you may be due a small refund, depending on your actual tax situation; I'd suggest consulting with an accountant or other tax professional for advice if you don't know the rules around what expenses, etc. you can claim to offset your rental income.

- If you still wish to increase the rent, send your tenant a valid rent review notice, making sure to include all of the required information (including examples of comparable properties to demonstrate market rate). Make sure everything is in order in case they decide to challenge the validity of the notice.

- Go to https://onestopshop.rtb.ie/ and read up on *everything* regarding the rules and regulations and proper procedures so that you don't make any further mistakes. Pay very close attention to the rules regarding Part 4 tenancies and how you can (and can't) legally terminate them, especially if you are planning to move back to Ireland and want to move back into your home again. Have an alternative option for accommodations in mind and be prepared to go through a long legal process should the tenant decide to challenge your termination or overhold; they've probably sussed out by now that you aren't really familiar with this whole landlord thing and it's possible they may see an opportunity to take advantage of that.

Claw Hammer

Graham wrote: »

1) register the tenancy with the RTB, even with the late fee/penalty it's not much.
2) issue your tenant with a formal notice of rent increase with the appropriate notice period.
3) find an accountant to consult with.

When the rent increase comes into effect, you can follow the arrears process if the tenant fails to pay the increased rent.

Tip: Don't confuse the thread or yourself by throwing in rants about the government or the banks. They are entirely irrelevant to your current situation.

The o/p has already made a failed attempt to increase the rent. He may now be stopped from increasing the rent until another 12 months has passed.

sillysmiles

dennyk wrote: »

- If you still live abroad, notify your tenant that they must start deducting 20% of their rent payment and remitting it to Revenue to cover your taxes.. This means they will directly pay you 80% of their actual rent amount (e.g. €480 instead of €600 under their current rent). You will be able to claim a credit for the amount they remit to Revenue on your behalf when you go to pay your own taxes. In the end you may either still owe some money or you may be due a small refund, depending on your actual tax situation; I'd suggest consulting with an accountant or other tax professional for advice if you don't know the rules around what expenses, etc. you can claim to offset your rental income.

What happens to the OP if, as his post suggests, the tenants are not averse to being selective it what they tell that tax office, and they continue to pay the 480 into his account, and when he gets home, the 20% hasn't been submitted to reviewed and he has been shafted both ways?

amcalester

sillysmiles wrote: »

What happens to the OP if, as his post suggests, the tenants are not averse to being selective it what they tell that tax office, and they continue to pay the 480 into his account, and when he gets home, the 20% hasn't been submitted to reviewed and he has been shafted both ways?

Revenue will chase the tenant for the money whether it was deducted from the rent or not.

TheChizler

sillysmiles wrote: »

What happens to the OP if, as his post suggests, the tenants are not averse to being selective it what they tell that tax office, and they continue to pay the 480 into his account, and when he gets home, the 20% hasn't been submitted to reviewed and he has been shafted both ways?

The tenant should be responsible for it in that case. The tenant is legally the responsible one if it's not paid to Revenue, Revenue have waived it in the past when the tenant didn't do the deduction out of ignorance. If they told the OP they were deducting 20% for Revenue they couldn't claim ignorance.

tvjunki

When you register with rtb either get either a letting agent or your dad as agent so the tenant will not hold the 20%.
Cancel t r s if you get it and if you gave then give back to revenue.

Put everything in writing. Texts are not accepted as notification of rent increase.
Start again with letter saying the rent is going to increase.
Give the correct notice of rent increase with 90days notice in rtb templates. Make sure you put 3properties similar to yours on the form. Keep copies on your pic. Get your dad or agent to reg delivery without signature of the letter.

The tenants cannot just be told to leave. Being threatened with threshold solicitors can happen. Fix this situation now.

Big thing do not give lease as they will have more rights.

Claw Hammer

tvjunki wrote: »

When you register with rtb either get either a letting agent or your dad as agent so the tenant will not hold the 20%.
Cancel t r s if you get it and if you gave then give back to revenue.

Put everything in writing. Texts are not accepted as notification of rent increase.
Start again with letter saying the rent is going to increase.
Give the correct notice of rent increase with 90days notice in rtb templates. Make sure you put 3properties similar to yours on the form. Keep copies on your pic. Get your dad or agent to reg delivery without signature of the letter.

The tenants cannot just be told to leave. Being threatened with threshold solicitors can happen. Fix this situation now.

Big thing do not give lease as they will have more rights.

A failed attempt to increase rent means that another attempt can't be made for the interval.

Graham

Claw Hammer wrote: »

A failed attempt to increase rent means that another attempt can't be made for the interval.

Have you a source for that Claw Hammer, as always the devil is in the detail and it would be useful to get familiar with the detail.

Axwell

Claw Hammer wrote: »

A failed attempt to increase rent means that another attempt can't be made for the interval.

A rent increase attempt by text message is invalid.

Graham

Axwell wrote: »

A rent increase attempt by text message is invalid.

I was thinking along the same lines. Invalid would suggest it may as well have not happened rather than it failed.

phildin

For what it's worth, I don't believe the banks go proactively looking at registrations of tenancies so you should be able to get everything registered with the PRTB and revenue without impacting on your mortgage rate.

Whether you are obliged to tell the bank that it's no longer your primary residence is another question, that's something that will be in the T&Cs of your mortgage agreement. If the bank did find out, they could decide to switch you to a buy to let rate but anecdotally, I haven't heard of this scenario.

My suggestion is to register with the PRTB (as everyone else has suggested), hire a solicitor to send a proper notice of arrears and separately, a notice of rent increase whenever it's legal/appropriate to do so. The same solicitor should be able to advise you on the best way to engage with revenue. Since you'll be a making a voluntary disclosure, you can expect them to be more accommodating than they would with someone who's caught committing fraud but you'll still need a solicitor to make sure you don't put a foot wrong in this process. It might be costly but it will be well worth it in the end to have this mess tidied up correctly.

Graham

phildin wrote: »

send a proper notice of arrears and separately, a notice of rent increase whenever it's legal/appropriate to do so.

I'm reading it that the tenant is only in arrears by the amount of the invalid rent increase, i.e. they're not actually in arrears.

Claw Hammer

Graham wrote: »

I was thinking along the same lines. Invalid would suggest it may as well have not happened rather than it failed.

The RTB hae held that an invalid rent increase is a failed attempt and resets the clock.
https://www.rtb.ie/documents/TR0216-001600/TR0216-001600-DR1215-22832%20Report.pdf

TheChizler

Claw Hammer wrote: »

The RTB hae held that an invalid rent increase is a failed attempt and resets the clock.
https://www.rtb.ie/documents/TR0216-001600/TR0216-001600-DR1215-22832%20Report.pdf

Could this be seen as part of the same review though?

AndrewJRenko

Does your house insurance know that you have tenants in the property?