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Gift from tenant

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  • 19-08-2020 10:34am
    #1
    Terrontress
    Registered Users Posts: 3,888 ✭✭✭


    I have a property which I let out, it is in negative equity and a pain in the balls. I have owned it since 2005 and have some very good tenants in there.

    Due to the rent pressure zone, I think their rent is about €450 less than recently refurbished apartments of the same nature.

    In February I got a message to say that the boiler had packed in. They have a newborn baby so I contacted a boiler engineer and got a new boiler immediately at a cost of €2,200.

    In June I got a message to say that the dishwasher isn't working. I am in the UK and asked if I had one delivered and the old one taken away, would the husband be able to fit it. The wife said she didn't think he could but if I paid for the dishwasher, she would pay for the labour. I said that that isn't acceptable and I would get a new one and have it fitted, which I did at a cost of €450.

    Last week she has put €100 in to my account to say thank you for being so understanding about everything and has told me to buy a treat for my kids.

    I wrote back and told her I can't accept it and to take it from her next month's rent, but she is insistent that I take it.

    I am very uncomfortable with this, I have no idea what it leaves me open to. Should I declare it in my tax return if I were to accept it? I think I can put their rent up next month as there was no increase last year, I am now feeling uncomfortable about this. I want a strictly business relationship.

    I have no bank details for them, they make a lodgement to my account each month for rent. The only thing I can think to do is to put it on top of their deposit and give it back when they move on.

    What do others think?


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    #2
    AustinLostin
    Registered Users Posts: 181 ✭✭AustinLostin


    You tried to return the money, which was a weird thing for the tenant to do tbh - a voucher or something would have been a more appropriate gift to give - honestly I would forget about it now unless they for some reason ask for it back.

    You want a strictly business relationship but you mention things like them having a newborn baby etc which is why you had a new boiler fitted. You had a responsibility to do this as part of your business relationship with the tenants anyway, along with the dishwasher if this came with the property.

    You're overthinking this. There is no reason to be reluctant to put the rent up if it is within the rules of RPZ. Considering the limits placed on you by RPZ sounds like they will still be getting a good deal on their rent even with the increase.


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    #3
    Browney7
    Registered Users Posts: 3,099 ✭✭✭Browney7


    Terrontress wrote: »
    I have a property which I let out, it is in negative equity and a pain in the balls. I have owned it since 2005 and have some very good tenants in there.

    Due to the rent pressure zone, I think their rent is about €450 less than recently refurbished apartments of the same nature.

    In February I got a message to say that the boiler had packed in. They have a newborn baby so I contacted a boiler engineer and got a new boiler immediately at a cost of €2,200.

    In June I got a message to say that the dishwasher isn't working. I am in the UK and asked if I had one delivered and the old one taken away, would the husband be able to fit it. The wife said she didn't think he could but if I paid for the dishwasher, she would pay for the labour. I said that that isn't acceptable and I would get a new one and have it fitted, which I did at a cost of €450.

    Last week she has put €100 in to my account to say thank you for being so understanding about everything and has told me to buy a treat for my kids.

    I wrote back and told her I can't accept it and to take it from her next month's rent, but she is insistent that I take it.

    I am very uncomfortable with this, I have no idea what it leaves me open to. Should I declare it in my tax return if I were to accept it? I think I can put their rent up next month as there was no increase last year, I am now feeling uncomfortable about this. I want a strictly business relationship.

    I have no bank details for them, they make a lodgement to my account each month for rent. The only thing I can think to do is to put it on top of their deposit and give it back when they move on.

    What do others think?

    They're probably worried you will want to sell due to all the recent maintenance of items that can and do go wrong. This €100 is a "peace offering" so to speak that they are acknowledging you've replaced items quickly at a cost to yourself and to their benefit. The tenant is also well aware of the price they are getting relative to the market and are afraid of losing it also. You should revise the rent next month to an amount that is allowable under the RPZ if it applies (they are probably expecting it).

    You have no tax liability from the "gift" as you can receive 3 grand a year from anyone and it's not taxable. I'd ensure you have it in writing from the tenant it is a gift and if you want to return when they eventually move out or you sell then do.


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    #4
    dubrov
    Registered Users Posts: 3,550 ✭✭✭dubrov


    The tenant knows they are getting cheap rent and are worried that all the recent expenses may trigger you to up their rent.
    The gift was a way of reminding you that they are a good tenant and will give you little hassle going forward.

    Choose to take that as you wish.


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    #5
    DubCount
    Registered Users Posts: 1,067 ✭✭✭DubCount


    Browney7 wrote: »
    You have no tax liability from the "gift" as you can receive 3 grand a year from anyone and it's not taxable. I'd ensure you have it in writing from the tenant it is a gift and if you want to return when they eventually move out or you sell then do.

    Its only €100, but I would not agree with that statement. The tenant is not a friend/family, so I would consider the money received as being in connection with your residential letting business, and taxable as a result. Its not enough money to be concerned about, but consider if you got a 3k "gift" every year from your tenant - I doubt Revenue would see it as a gift.


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    #6
    nthclare
    Banned (with Prison Access) Posts: 3,316 ✭✭✭nthclare


    Ah for heaven's sake,the lady was full of gratitude and appreciation for your prompt attention to her concerns and it's an act of kindness and professionalism that goes way beyond what most landlords would do.

    I think you're a credit to yourself.

    It would be insulting to her to refuse her gift, what you did for her was very kind and thoughtful.

    I wouldn't read into it the way some here are, accept her gift and don't listen to the ruthless bell ends trying to undermine your generosity and support for a family in need.

    You're a good honest, professional landlord and well done :)


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    #7
    dubrov
    Registered Users Posts: 3,550 ✭✭✭dubrov


    nthclare wrote:
    Ah for heaven's sake,the lady was full of gratitude and appreciation for your prompt attention to her concerns and it's an act of kindness and professionalism that goes way beyond what most landlords would do.

    What would most landlords do?

    The boiler and dishwasher broke. The landlord is obligated to repair these.


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    #8
    Dempo1
    Registered Users Posts: 26,932 ✭✭✭✭Dempo1


    Have to say it's nice and refreshing to hear such a story and on both sides. Personally you should be congratulated and as far as I'm concerned accept the gesture for what it is, genuine appreciation, it's really that simple. You've adhered to your obligations in every respect and really that's all that should matter :)

    Is maith an scáthán súil charad.




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    #9
    Pkiernan
    Registered Users Posts: 4,315 ✭✭✭Pkiernan


    Speaking as a landlord, I wouldnt take cash gifts from tenants

    You're obviously concerned about it, so either return it or declare it as overpaid rent.


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    #10
    Browney7
    Registered Users Posts: 3,099 ✭✭✭Browney7


    DubCount wrote: »
    Its only €100, but I would not agree with that statement. The tenant is not a friend/family, so I would consider the money received as being in connection with your residential letting business, and taxable as a result. Its not enough money to be concerned about, but consider if you got a 3k "gift" every year from your tenant - I doubt Revenue would see it as a gift.

    What revenue guidance exists to that effect? The rule on the small gift exemption I see is that you can receive 3k per annum from anyone. Interested if they have a publication or list of exemptions or a definition of a what doesn't constitute a "gift" and would be deemed income.

    If the tenant has a lease specifying a rent and they decide to lavish the landlord with a gift as they are generous tenants is that not their business?


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    #11
    nthclare
    Banned (with Prison Access) Posts: 3,316 ✭✭✭nthclare


    dubrov wrote: »
    What would most landlords do?

    The boiler and dishwasher broke. The landlord is obligated to repair these.

    Most landlords wouldn't be as professional and trustworthy to be honest.

    They'ed hope the problem would go away and the tenant would more than likely forget about it or pay for it out of their own pocket.

    Therefore the landlord could play game's and say, oh well I would have gotten it done for cheaper by someone else and the usual stories.

    We'll give you the last month free rent before you vacate the property, but it wouldn't be sincere.

    When the last month comes the landlord will be hoping the Tennant forgot about the agreement thing and amyhow the tennant hadn't it in writing so their loss...

    Good luck


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    #12
    nthclare
    Banned (with Prison Access) Posts: 3,316 ✭✭✭nthclare


    Pkiernan wrote: »
    Speaking as a landlord, I wouldnt take cash gifts from tenants

    You're obviously concerned about it, so either return it or declare it as overpaid rent.

    Seriously ???


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    #13
    c.p.w.g.w
    Registered Users Posts: 4,994 ✭✭✭c.p.w.g.w


    nthclare wrote: »
    Most landlords wouldn't be as professional and trustworthy to be honest.

    They'ed hope the problem would go away and the tenant would more than likely forget about it or pay for it out of their own pocket.

    Therefore the landlord could play game's and say, oh well I would have gotten it done for cheaper by someone else and the usual stories.

    We'll give you the last month free rent before you vacate the property, but it wouldn't be sincere.

    When the last month comes the landlord will be hoping the Tennant forgot about the agreement thing and amyhow the tennant hadn't it in writing so their loss...

    Good luck

    I was in a place with, mould, damp and heating problems...couldn't get the management company to fix them it was driving me mad...Until the apartment above flooded and thus my apartment flooded...

    Management company then set about getting all the issues fixed under the guise of the issues being as a result of the flooding in the above apartment...Well that was until, i got in contact with the owner of the above apartment and told him...

    His insurance company got in touch, and i had all my pictures and emails about the issues, along with pictures of the the actual damage caused by the flooding(which was minimal considering)...

    Lets just say the owner of the management company wasn't best pleased with me:D:D:D:D


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    #14
    Irish_peppa
    Registered Users Posts: 653 ✭✭✭Irish_peppa


    Browney7 wrote: »
    What revenue guidance exists to that effect? The rule on the small gift exemption I see is that you can receive 3k per annum from anyone. Interested if they have a publication or list of exemptions or a definition of a what doesn't constitute a "gift" and would be deemed income.

    If the tenant has a lease specifying a rent and they decide to lavish the landlord with a gift as they are generous tenants is that not their business?

    The small gift exemption is an odd one for instance someone renting a room from you could use this to avoid going over the 14K limit
    Could a lodger or tenant use this if they suddenly became your friend after a beer or two :confused: not a lot on revenue about it.

    https://www.revenue.ie/en/gains-gifts-and-inheritance/cat-exemptions/small-gift-exemption/index.aspx


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    #15
    Samuel T. Cogley
    Registered Users Posts: 10,684 ✭✭✭✭Samuel T. Cogley


    Pkiernan wrote: »
    Speaking as a landlord, I wouldnt take cash gifts from tenants

    You're obviously concerned about it, so either return it or declare it as overpaid rent.

    This. Once it comes time to part ways it goes back with the deposit.


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    #16
    [Deleted User]
    Posts: 0 ✭ [Deleted User]


    Some funny people in the world, I wouldn't think twice about taking it. I would accept any and all gifts from anyone willing to give them to me. The 100 euro in an envelope would have been more ideal but I would still be considering it a gift and not declaring it as rent etc.

    The small gifts exemption applies to everyone not just friends and family. I received a wedding gift from my employer and that is obvioulsy not payment for work - this is no different.


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    #17
    lawred2
    Registered Users Posts: 24,283 ✭✭✭✭lawred2


    What's the problem here?

    I see a story of a good responsible landlord and a gracious tenant.

    Wish all landlord/tenant relationships were like this!


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    #18
    CoBo55
    Registered Users Posts: 8,798 ✭✭✭CoBo55


    nthclare wrote: »
    Ah for heaven's sake,the lady was full of gratitude and appreciation for your prompt attention to her concerns and it's an act of kindness and professionalism that goes way beyond what most landlords would do.

    I think you're a credit to yourself.

    It would be insulting to her to refuse her gift, what you did for her was very kind and thoughtful.

    I wouldn't read into it the way some here are, accept her gift and don't listen to the ruthless bell ends trying to undermine your generosity and support for a family in need.

    You're a good honest, professional landlord and well done :)

    Bang on!! You saved me the bother of typing.


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    #19
    lawred2
    Registered Users Posts: 24,283 ✭✭✭✭lawred2


    c.p.w.g.w wrote: »
    I was in a place with, mould, damp and heating problems...couldn't get the management company to fix them it was driving me mad...Until the apartment above flooded and thus my apartment flooded...

    Management company then set about getting all the issues fixed under the guise of the issues being as a result of the flooding in the above apartment...Well that was until, i got in contact with the owner of the above apartment and told him...

    His insurance company got in touch, and i had all my pictures and emails about the issues, along with pictures of the the actual damage caused by the flooding(which was minimal considering)...

    Lets just say the owner of the management company wasn't best pleased with me:D:D:D:D

    The management company is "owned" by the apartment owners right?


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    #20
    Samuel T. Cogley
    Registered Users Posts: 10,684 ✭✭✭✭Samuel T. Cogley


    lawred2 wrote: »
    What's the problem here?

    I see a story of a good responsible landlord and a gracious tenant.

    Wish all landlord/tenant relationships were like this!

    It's a business relationship the price charged should be the price paid. Accepting gifts is just asking for trouble when it comes to the tricky aspects of a LL/Tenant relationship such as a rent increase or giving them notice.

    It also doesn't sit well with me given the dynamic of the relationship between LL and Tenant.


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    #21
    [Deleted User]
    Posts: 14,344 ✭✭✭✭ [Deleted User]


    Is there anything to be said for throwing it in an envelope and giving it back to her at Christmas?


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    #22
    pauliebdub
    Registered Users Posts: 1,061 ✭✭✭pauliebdub


    Samuel T. Cogley wrote: »
    It's a business relationship the price charged should be the price paid. Accepting gifts is just asking for trouble when it comes to the tricky aspects of a LL/Tenant relationship such as a rent increase or giving them notice.

    It also doesn't sit well with me given the dynamic of the relationship between LL and Tenant.

    I would agree with this. The tenant/landlord relationship is a professional one and since they are not friends or family I wouldn't have accepted the gift either. There could be an assumption of strings attached on the tenants part which may cause problems down the line if you wish to evict or increase the rent. I'd return the 100 euro.


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    #23
    DubCount
    Registered Users Posts: 1,067 ✭✭✭DubCount


    Browney7 wrote: »
    What revenue guidance exists to that effect? The rule on the small gift exemption I see is that you can receive 3k per annum from anyone. Interested if they have a publication or list of exemptions or a definition of a what doesn't constitute a "gift" and would be deemed income.

    If the tenant has a lease specifying a rent and they decide to lavish the landlord with a gift as they are generous tenants is that not their business?

    I reckon this falls under the General anti-avoidance rule (GAAR) under 811C of the TCA 1997.

    My view is that if you receive payment from a tenant, its rental income. If you intend to return it, its an increase in the deposit. In the same way as when an employer gives a "gift" to an employee, its taxable unless its under De Minimus.

    Its a lovely gesture from the tenant, but my tax return would not treat it as a gift.


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    #24
    c.p.w.g.w
    Registered Users Posts: 4,994 ✭✭✭c.p.w.g.w


    lawred2 wrote: »
    The management company is "owned" by the apartment owners right?

    Not all the apartments, the one above was a private landlord...

    Basically complex had 12 duplex's, 10 apt's, car park & bins were managed by Management company and 2 apt's were still in private ownership


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    #25
    Agent Smith
    Moderators, Regional East Moderators Posts: 21,502 Mod ✭✭✭✭Agent Smith


    If you are really unconfortable about keeping the €100, Why not use it to buy something for the newborn?


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    #26
    Obvious Desperate Breakfasts
    Closed Accounts Posts: 8,474 ✭✭✭Obvious Desperate Breakfasts


    Samuel T. Cogley wrote: »
    It's a business relationship the price charged should be the price paid. Accepting gifts is just asking for trouble when it comes to the tricky aspects of a LL/Tenant relationship such as a rent increase or giving them notice.

    It also doesn't sit well with me given the dynamic of the relationship between LL and Tenant.
    pauliebdub wrote: »
    I would agree with this. The tenant/landlord relationship is a professional one and since they are not friends or family I wouldn't have accepted the gift either. There could be an assumption of strings attached on the tenants part which may cause problems down the line if you wish to evict or increase the rent. I'd return the 100 euro.

    Businesses give each other gifts sometimes though. Why would this be any different?

    Honestly, I'm despairing a bit at some of the over-analysis and responses on this thread. Such cynicism.


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    #27
    DubCount
    Registered Users Posts: 1,067 ✭✭✭DubCount


    Obvious Desperate Breakfasts wrote: »
    Businesses give each other gifts sometimes though. Why would this be any different?

    Honestly, I'm despairing a bit at some of the over-analysis and responses on this thread. Such cynicism.

    Businesses giving "gifts" to people in other businesses is usually to carry favour in future orders etc. Thats why many companies have policies against allowing staff to accept gratuities from suppliers etc.

    The days when the Landlord / Tenant relationship was anything other than a formal professional engagement are long gone. There are volumes of legislation and RTB decisions governing how this relationship works. Thats the way our government wants it - and there is no place left for sentimental gestures. Its not cynicism - its playing the game by the playbook provided.


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    #28
    flazio
    Registered Users Posts: 12,830 ✭✭✭✭flazio


    So the takeaway here is to maintain a "professional distance"?
    No wonder landlords get a bad stick for being just money scroungers.
    Nothing wrong in having a bit of humanity in professional relationships.


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    #29
    mistress_gi
    Registered Users Posts: 963 ✭✭✭mistress_gi


    I'm a tennant with an unbelievably good landlord.
    During lockdown i had a friend stay over and i told the landlord i would be happy to pay extra until she was gone. He said no.
    However he will have to replace the fence in the house and i have offered to pay towards it.
    I know how good i have it (I'm paying under market rate as well) and i am happy to pay towards the new fence.
    I think you have really good tennants and should keep the gift.
    FYI i have no strings attached to the extra I'll pay towards the new fence. If he gives me notice tomorrow I'll leave as soon as i find a suitable place.


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    #30
    [Deleted User]
    Posts: 0 ✭ [Deleted User]


    Deleted User wrote: »
    Is there anything to be said for throwing it in an envelope and giving it back to her at Christmas?

    No, keep it and spend it on something for yourself.

    People love turning down free money. I wouldn’t have a notion of mentioning it in a tax return either.


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    #31
    Obvious Desperate Breakfasts
    Closed Accounts Posts: 8,474 ✭✭✭Obvious Desperate Breakfasts


    DubCount wrote: »
    Businesses giving "gifts" to people in other businesses is usually to carry favour in future orders etc. Thats why many companies have policies against allowing staff to accept gratuities from suppliers etc.

    The days when the Landlord / Tenant relationship was anything other than a formal professional engagement are long gone. There are volumes of legislation and RTB decisions governing how this relationship works. Thats the way our government wants it - and there is no place left for sentimental gestures. Its not cynicism - its playing the game by the playbook provided.

    Small family-run businesses and sole traders still accept gifts all the time. They’re not big enough to have policies in place. The majority of landlord businesses would be of that size. It’s really not a big deal at all.


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