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Capital Gains Tax on Property that was rented while working abroad.

  • 30-03-2022 10:36pm
    #1
    DeclanC99
    Registered Users, Registered Users 2 Posts: 1 ✭


    Hi, so I purchased the property in 2017 for 50k and rented it out (all income tax paid with revenue as a non-resident).

    I was living abroad at the time for work. Returned back to Ireland in 2019 and moved into the property.

    I am receiving conflicting information regarding CGT.

    One individual informed me I would not have to pay as it was the only property I own (Google tells me I would need to pay for the period it was rented).

    Upon reading the revenue site, it said you are exempt from CGT if you lived abroad for work.

    Can anybody please clarify? If I was to sell the property for say 100k how much CGT am I looking at?



Comments

  • #2
    adrianw
    Registered Users, Registered Users 2 Posts: 236 ✭✭adrianw


    If it was purchased as your principal private residence (PPR) and you lived in it, it would qualify for PPR relief.

    If you bought it as an investment property but lived elsewhere such as a family home, it doesn’t matter if this was your only property, CGT would apply to the gain.



  • #3
    Happyhouse22
    Registered Users, Registered Users 2 Posts: 504 ✭✭✭Happyhouse22


    Principal Private Residence relief exists to exempt from capital gains tax, gains arising on the disposal of an individual’s principal private residence. Where an individual’s

    principal private residence (including grounds up to a maximum of one acre) has been used as such throughout the entire period of ownership, an exemption applies on disposal. Any period during which the individual was absent as a result of performing the duties of an employment abroad will be considered a period of deemed occupation. Essentially, this relief considers the individual to

    have occupied the property for the full period of ownership notwithstanding the fact they were working abroad. There is no restriction on the amount of time that can be considered a period of deemed occupation. However, a number of conditions apply that specify that the individual must live in the property both immediately before and after the foreign absence, and must not have a principal private residence available to them in the other country.

    Source: Deloitte Moving abroad Irish Tax Guide

    Looks like you wouldn’t get the exemption technically as you dint live in the house before moving abroad. That said if it is a significant sum it might make sense to employ a tax consultant who could argue a different position. If yiu have an opinion in writing that you don’t need to pay it then I can’t see revenue having an issue - bit of a grey area.



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