Accidental Landlord Question -

Tax evasion (over 12 years) is a technically a crime, no matter how nice people think the OP was being in renting out their property under market rate.

Do the sums...tax owed before interest /penalty will be low. The serious crime you hope they will be convicted of will be mitigated by self declaring and the amount of tax owed.

Gary, with respect, what you think of what the OP did or it's seriousness does not matter. Everyone makes mistakes and this does not read to me as deliberate or serious tax evasion. Sorry to break the bad news but someone has to tell you.

I know you have no time for landlords and used terribly rude word out of context to refer to the three that had the misfortune to rent to you. The reality is most LL are probably nicer than you and certainly not as bitter. The OP will move on, you need to as well.

Yes, once the retrospectively register and pay the fees before making the return for each year. See attached

OP has got into a mess for sure. It’s hard to see how anyone letting property in the past number of years wasn’t aware of the RTB and the numerous changes in the rental sector. It was in the news and on tv and radio programmes constantly. Some sectors are more tightly regulated than others to cut out the ‘black market’ and property seems to be top of that list. Also, everyone that works, whether paye or self employed, knows that income is taxable.

Having said that, all sorts of people do nixers and cash jobs, they know the game and so do their customers, but those people (both traders and professionals) don’t seem to get the same hatred as landlords. It is very strange and must be connected to historical issues where all landlords were seen as evil personified, ergo, all landlords today must also be evil greedy parasites, who take advantage, swindle and mistreat tenants. Please 🤣

The way some people go on, one would think that tenants are less than savvy and are hoodwinked into signing a lease. It’s like there’s a plot by ‘greedy landlords’ to part them from their money when in fact, landlords are supplying the dwelling and tenants are paying to use it. No different than any other sector when a renter pays for a service where the ownership of the item does not change. There are many things that fall into that category, but those suppliers don’t seem to get the same hatred and vitriol that is levelled at the suppliers of dwellings.

Also, consumers of any item or product pay for the assets and goodwill of a business over time, most businesses operate for profit. Property letting in the private market is the same, it’s not a social enterprise even though some would like it to be. The social responsibility belongs to the state and the many charities funded by the state, not private landlords.

In the real world, the OP’s tenants had a great deal for 12 years, and like most consumers, they were glad of it and didn’t turn it down. The OP’s tax affairs are nobody’s business except revenue and they will be sorted eventually. If there are back taxes, fines or penalties due, they will be paid. The state coffers will not miss out. No hatred needed.

Mrslancaster:

Also, consumers of any item or product pay for the assets and goodwill of a business over time, most businesses operate for profit. Property letting in the private market is the same, it’s not a social enterprise even though some would like it to be. The social responsibility belongs to the state and the many charities funded by the state, not private landlords.

To be clear, the assets and other capital of any enterprise are provided by the shareholders/owners/proprietors of the enterprise, not by the customers. It's the fact that they provide the capital that entitles the owners to receive the profits of the business. This is pretty much the fundamental basis of the capitalist enterprise. It's really not negotiable. (An enterprise in which the customers provide the capital is what we call a co-operative or a collective. In such an enterprise there are no external owners to whom the profits of the business are to be paid.)

Obviously, the capitalist who owns an enterprise hopes/expects that the profits of the business that they receive will exceed the cost (to them) of providing the capital; if they didn't, they wouldn't invest in the business. But there is a risk that the profits will not exceed the cost of capital and that risk is born by them, the capitalists, not by their customers. There's no reason why the price am enterprise can charge its customers should be assumed to rise to cover the owner's cost of capital, whatever that might be. If an owner finds himself in the position that profits don't cover the cost of capital, he might consider himself unfortunate, or he might consider himself foolish, but what he is not entitled to do is consider himself unfairly treated. A risk that he took has gone against him; that is nobody else's fault. Nor is this an example of market failure; the market is in fact working exactly as a market should.

A time of housing crisis caused by hugely increased property values is precisely the kind of time where landlords may suffer. The more houses cost, the more capital a landlord has to put in to his enterprise of renting a home. Therefore, the higher the rent he will have to charge for the profits of the enterprise to cover his cost of capital. But the higher the rent, the lower the demand. You might think that everybody needs to be housed, and they do, but they don't all have to be housed in privately-owned property let at the market rent. More and more of the housing demand will be diverted into other options — people seek housing from the local authority or other housing agencies; they live for longer in shared houses, renting one house between them instead of two or three; they live at home for longer, renting no house at all; etc. And, remember, a great many people who are seeking to rent properties are doing so precisely because they can't finance the cost of buying properties. But if they can't afford to finance the cost of buying a property directly, the likelihood that they can afford rents that will indirectly finance it is not great.

In other words, the times we are living in right now are precisely the times when landlords are at greatest risk of net rents not covering their cost of capital. So if the market is working as markets should, we should expect landlording to be a not very profitable enterprise right now, and a higher than usual proportion of landlords to be experiencing financial stress.

It is very strange and must be connected to historical issues where all landlords were seen as evil personified, ergo, all landlords today must also be evil greedy parasites, who take advantage, swindle and mistreat tenants. Please 🤣

It's not that strange. Sure, it's not fair on landlords, because they are not, in fact, all evil greedy parasites. (The OP, in particular, clearly is not.) But in a time of housing crisis tenants also suffer, and it's understandable that they will look for someone to blame. The landlord is an obvious target. (Made more obvious, I have to say, by those landlords who go about loudly complaining in ways that make it clear that they regard it as their entitlement to have rents always cover their cost of capital.)

All people are saying, I think, is that the OP's tax evasion was not motivated by greed. He didn't trouser the excess profits resulting from the evasion, but generously passed them to his tenant in the form of a heavily discounted rent.

(He didn't think this through, obviously, so we don't have a Robin Hood vibe going on here. But he wasn't motivated by greed.)

If they started off at the market rate, and increased every year by the allowable amount then yes it is true..

@Donald Trump

No matter how many times you say it renting property is not passive investment. For a person claiming what is “correct” you know that it is an outright lie to keep calling it that. I won’t bother repeating myself on issues I have dealt with because you are not going to respond to those issues. Passive investment has a definition and renting a property is clearly not in that realm.

I also laugh at the "accidental landlord" tag that people give themselves, as if they fell over their shoelace one day and ended up with a property that they have been renting out or several years, with no way out

One of the biggest ones https://www.oxfamireland.org/blog/time-for-ireland-to-address-past-and-current-tax-haven-like-behaviour

Kind of related question.

Property rented for ten years well below the market rent. 1200 instead of 1900.

Finally raised the rent by 60 a year back. But registered with RTB that rent was 1600.

Fully tax compliant on the actual 1200 rent collected.

Decided to sell the property now. Estate agent said the rtb registered rent of 1600 makes it much more attractive to investors.

Question is .. is there a danger here that revenue looks at the RTB declaration and comes after me for tax on rent of 1600?

Do revenue and rtb work together on this?

Would the fine for declaring the wrong rent to rtb be worth less than the tax or fine for the income I never actually made?

Thanks for any help ...

And incredibly niave to think that larger amounts of money is not hidden from the government ith ppl wh have the means to do it..

Just because you dont know specific cases doesnt mean it doesnt happen…