Mortgage Interest Relief (Tax Relief at Source - TRS) on Rental property

lotusm

Hi,

My wife has a property that was her principal private residence before we got married recently. We now live in my house which I bought a long time ago. In feb 2023 we decided to rent her house out.

On the form 11 tax form can you claim & the deduct as an expense the Mortgage Interest Relief (Tax Relief at Source - TRS) on the rental property ?

thanks

3DataModem

If she is getting TRS on her mortgage (she must have the place a long time) then once she began renting it out she should stop claiming TRS.

As per revenue.ie:

"You must notify Revenue by completing a TRS4 Form and returning it to the address quoted on the form if you are getting Mortgage Interest Relief on (…) a property that is no longer your home. An example would be if you moved out and now rent out the property."

Once she has done that, she can start claiming the interest expense as deductible against the rent.

Geuze

TRS was/is a tax relief on mortgage interest claimed by people living in their PPR.

It is not to be confused with deducting relevent mortgage interest from gross rental income in a landlord's tax return.

lotusm

thanks all

lotusm

thanks very much , sorry the delayed response. So does the mortgage loan on the PPR become a commercial loan on the rental , will the bank charge a higher interest rate on it now and is there anything else we need to consider ? thanks

3DataModem

https://www.boards.ie/discussion/comment/122759717#Comment_122759717

I've posted this before here; just don't bother telling the bank. Up to about 5-6 years ago they never, ever, used to care about PPR borrowers moving to BTL rates, and removing TRS was not a trigger for them. Things might have changed, but just don't tell them.