Capital gains - renting

cuttingtimber22

I could not find an answer on Revenue.ie although to be fair many of examples can be useful so perhaps I missed it.

I bought an apartment in 2006 as a PPR. Pretty much in negative equity since 2008 which has still not recovered. For work reasons I am considering taking up a position abroad and thinking of renting out the apartment. I have a fair idea of the tax arrangements for renting, what I can claim and not claim and so on, but i wondering how CGT will work.

If the property gains value over the period and I was to sell at some point, what is the base value - the date of first renting or date of purchase? if I was to rent for 5 years and then move back as a PPR and eventually sold the property is there a CGT liability? Or is there a lot of it depends there.

ari101

You'll calculate the gain as sale price less 2006 cost price regardless of renting. The gain can also be reduced by allowable expenses.

You then work out the period you are not entitled to relief on, compared to the total years owned.

Some if the following rules my help increase relief in your situation:

The last 12 months of ownership of a PPR is considered to be included in your period of occupation.

You will be considered to have lived in your property where:

-you could not live in the property because your employer required you to live elsewhere (up to a four-year maximum.)

-you had a job, all the duties of which were performed outside the Republic of Ireland

Have a look at example 2 on this page to see how it works

https://www.revenue.ie/en/gains-gifts-and-inheritance/cgt-reliefs/principal-private-residence-ppr-relief.aspx

cuttingtimber22

https://www.boards.ie/discussion/comment/118573607#Comment_118573607

Thanks a mill. Very useful. It may still end up as a capital loss but that information on reliefs is super helpful.