Non-resident landlord

elgriff

Hi folks

QQ. I live in USA. Tax affairs in Ireland all in order but for non-resident landlord withholding.

Ive a friend who lives in a house I own in Ireland. Proper lease, registered with PRTB etc. He is happy to withhold and pay 20% to revenue.

Great - but exactly how? Log in to Ros.ie and make a payment each month? If so, what type of payment is it? Tax -> Income?

Says in all the articles I have read: "tenant pays revenue directly with cash or direct debit". Not clear exactly where to instruct him to send said money

Thank you!

Daxve

https://www.revenue.ie/en/tax-professionals/tdm/income-tax-capital-gains-tax-corporation-tax/part-45/45-01-04.pdf

Strictly, the tenant should account for the tax immediately after it is
deducted. However, Revenue will allow tenants to remit the tax deducted
from the rent when filing a return of income for the tax year, which is Form
11 for chargeable persons or Form 12 for non-chargeable persons. For
persons whose sole income is subject to PAYE, recovery of the tax deducted
can be achieved by adjustment of tax credits.

Your tenant should account for the tax deducted at year end by filing a Form 11 (chargeable person) or Form 12 (PAYE) and declaring the amount they have withheld from you in the relevant section. That will will raise a charge on their account and they can pay the tax due. They give you a Form R185 to confirm the tax was paid and you can claim credit for this on your own return.

Alternatively if your tenant is PAYE only they can have their tax credits and SRCOP adjusted to collect the tax due over the course of the year. If the rent was for example €10,000 per annum the tax due is €2,000 (20%) they can ask Revenue to reduce their tax credits by €2,000 and that collects the tax due without the requirement for other payments. They still have to give you a Form R185 so you can claim credit for it.

elgriff

Well-explained, thank you