Tax on a rental...

Kidkinobe

I will be returning to Ireland in the New Year to buy a house in the Laois/Kildare area, priced between 200/250k, just an average semi detached. Looking in daft rental, the type of house I would buy returns about 1100 Euro a month. I would have no mortgage.
So if that 1100 a month was my only source of income, and I didn't live/work in Ireland, how much of the 1100 per month would I have to pay the tax man.
Please note, that 1100 per month would be my only source of income world wide.

Are you living in the house too?

Kidkinobe

Deleted User wrote: »

Are you living in the house too?

No, I wont be staying In Ireland, going on a bit of a trip for a few years. So it will be rented out under the control of a property manager.

Rulmeq

Your tenants will have to withhold 20% and pay it directly to the revenue, you would have to apply to revenue to get it back at the end of the year (assuming your income is only €13,200 you would get it back), so that might impact your spending power. (You can avoid this by using an agent, but they generally take the first months rent, so that doesn't really pay for itself)

You're not going to have a great time of it either, what do you do if they ring you up to tell you the boiler broke, or the washing machine is flooding the kitchen etc. Would it not be better to just stick your 250k into a savings account, and just taking 13k out of that to live off instead.

Kidkinobe

Rulmeq wrote: »

Your tenants will have to withhold 20% and pay it directly to the revenue, you would have to apply to revenue to get it back at the end of the year (assuming your income is only €13,200 you would get it back), so that might impact your spending power. (You can avoid this by using an agent, but they generally take the first months rent, so that doesn't really pay for itself)

You're not going to have a great time of it either, what do you do if they ring you up to tell you the boiler broke, or the washing machine is flooding the kitchen etc. Would it not be better to just stick your 250k into a savings account, and just taking 13k out of that to live off instead.

Thanks! Don't get much of a return on savings, and I will end up living in the house in a few years, and I believe property prices in Laois/Kildare will go up by 15% in the next 2 years, so Im thinking its wiser to buy soonish rather then 2 years down the track.
As mentioned above, I will get in a property agent to get it rented and they will manage the tenants should any problems arise.

Rulmeq

Kidkinobe wrote: »

As mentioned above, I will get in a property agent to get it rented and they will manage the tenants should any problems arise.

Sorry I missed that in your original message, it does make it easier for everyone (although more expensive for you).

holystungun9

Get real references from that property manager. You dont want a useless manager. I guess they’ll take 10% of rent collected. Please don’t forget the yearly costs of local property tax. €90 to register the tenancy with Rtb for 4 years. Seriously consider yearly contents insurance - for your contents but also the third party insurance that should be bolted on. It’s your gamble to get it or not but investigate at least. The “small” legal things like window restrictors upstairs. You don’t want that phone call that a kid fell or something. Vet tenants. Unfortunately there always is potential for things to go bad and your manager might not approach things how you would ( for better or worse ).

Mrs OBumble

holystungun9 wrote: »

Seriously consider yearly contents insurance - for your contents but also the third party insurance that should be bolted on. It’s your gamble to get it or not but investigate at least.

All good advice from the post above, except this bit. Don't just seriously consider it. Have contents insurance as part of your house-insurance: the value of things like water tanks, carpets, curtains etc adds up very quickly.

You will need a LL policy anyways, not just regular house insurance.

Kidkinobe

holystungun9 wrote: »

Get real references from that property manager. You dont want a useless manager. I guess they’ll take 10% of rent collected. Please don’t forget the yearly costs of local property tax. €90 to register the tenancy with Rtb for 4 years. Seriously consider yearly contents insurance - for your contents but also the third party insurance that should be bolted on. It’s your gamble to get it or not but investigate at least. The “small” legal things like window restrictors upstairs. You don’t want that phone call that a kid fell or something. Vet tenants. Unfortunately there always is potential for things to go bad and your manager might not approach things how you would ( for better or worse ).

Thanks for the info...Ive been a LL for numerous years overseas and insurance was always a priority. Of course I know nothing about being a LL in Ireland or the tax system, so all info is greatly appreciated.