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Renting house vs letting rooms

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  • 07-11-2019 3:31pm
    #1
    Jake5991
    Closed Accounts Posts: 187 ✭✭


    Im going to be changing jobs soon and for the first year il be on under 200 euros

    Would i be better off renting house or letting rooms as regards tax . I want to use the property to bring my total income up as il be on very low salary for awhile.
    Rooms will be between 300 - 400 euro per room .

    Any advice greatly appreciated


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    #2
    namenotavailablE
    Registered Users Posts: 59,564 ✭✭✭✭namenotavailablE


    If you continue to live in the house you can avail of the 'Rent-a-room relief' which allows you generate a max of €14000 without any tax consequences.

    However, there are a number of conditions which you'd need to be aware of and comply with as outlined on the linked page.

    Free Excel net pay calculator- https://taxcalc.eu/monthlyss/Employee%20PAYE%20calculator.xlsm



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    #3
    Calahonda52
    Registered Users Posts: 12,217 ✭✭✭✭Calahonda52


    As above re the tax, there are also different contractual arrangements, IIRC rent a room folk are not tenants...

    “I can’t pay my staff or mortgage with instagram likes”.



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    #4
    Jake5991
    Closed Accounts Posts: 187 ✭✭Jake5991


    Thanks for that . What are the conditions that I would need to comply with ? I only own the house a few years im new to all this and when I find the info I need im left with more questions than answers


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    #5
    L-M
    Registered Users Posts: 23,694 ✭✭✭✭L-M


    Jake5991 wrote: »
    Thanks for that . What are the conditions that I would need to comply with ? I only own the house a few years im new to all this and when I find the info I need im left with more questions than answers

    It has to be a total income of under 14000 per year. , purely in rental income. You have to also live in the house.

    It’s all in the link above really. You also do have to report it to revenue but you won’t have to pay tax.

    Also you can sublet a rented property with the agreement of the landlord


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    #6
    Grumpypants
    Registered Users Posts: 7,762 ✭✭✭Grumpypants


    Live in the house and rent out the other rooms. You don't pay tax on 14k and don't have to rent elsewhere and can split bill, so costs are low.


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    #7
    Heres Johnny
    Closed Accounts Posts: 2,738 ✭✭✭Heres Johnny


    Jake5991 wrote: »
    Thanks for that . What are the conditions that I would need to comply with ? I only own the house a few years im new to all this and when I find the info I need im left with more questions than answers

    You need to live in the house and it must be your primary residence, in other words your main house.
    You can earn up to 14,000 euro a year

    Comply with these and you pay no tax although you are meant to declare it as income which will be means tested in the event you have a social welfare claim

    If you move out of the house or earn more than 14000 euro you are liable for tax on your income

    I have done it myself in the past, my brother lived with me and I wasn't liable for rent.

    My now fiance was initially meant to be a short term lodger too!!

    Never paid any tax, nor was I meant to


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    #8
    Jake5991
    Closed Accounts Posts: 187 ✭✭Jake5991


    Well that helps my situation a lot . Its one less thing iv to worry about now


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    #9
    Jake5991
    Closed Accounts Posts: 187 ✭✭Jake5991


    So I can just rent a room out without having to declare anything or registering with prtb


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    #10
    L-M
    Registered Users Posts: 23,694 ✭✭✭✭L-M


    Jake5991 wrote: »
    So I can just rent a room out without having to declare anything or registering with prtb

    You have to declare the income to revenue but you won’t pay tax on it unless it exceeds 14000


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    #11
    Jake5991
    Closed Accounts Posts: 187 ✭✭Jake5991


    You guys are all legends haha. Im currently in the defence forces looking to get into the guards so I just wanted to know what my options were. Army wages are worst in public sector unless your an officer. I want to have a family and ant to be able to give them a decnt life and that's not feasible in the df now. Thanks a mil guys


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    #12
    Heres Johnny
    Closed Accounts Posts: 2,738 ✭✭✭Heres Johnny


    Jake5991 wrote: »
    You guys are all legends haha. Im currently in the defence forces looking to get into the guards so I just wanted to know what my options were. Army wages are worst in public sector unless your an officer. I want to have a family and ant to be able to give them a decnt life and that's not feasible in the df now. Thanks a mil guys

    If you have a 3 bed, rent out 2 rooms, if you have 4 bed, rent out 3......just makke sure you keep a, room for yourself. And that you keep it all under 14k per year


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    #13
    Jake5991
    Closed Accounts Posts: 187 ✭✭Jake5991


    Just a quick follow up on this can i earn 10000 euro a year without paying tax if its my primary residence.


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    #14
    Jake5991
    Closed Accounts Posts: 187 ✭✭Jake5991


    Basically i want to rent out the whole house out and not sure if i have to pay tax or not.


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    #15
    Grumpypants
    Registered Users Posts: 7,762 ✭✭✭Grumpypants


    There is no tax break for landlords renting a full house. You would pay tax on it all.

    If you live in the house you can rent all the other rooms and get 14k tax free.


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    #16
    Jake5991
    Closed Accounts Posts: 187 ✭✭Jake5991


    Ah ok .


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    #17
    guy101
    Registered Users Posts: 11 ✭guy101


    Question on this (google has brought me here).
    I’m in the process of buying a four bed gaff with a mate - both sick of paying ridiculous rent.
    Plan is to each take an extra bedroom and rent it out.
    We both seem to meet the requirements outlined on the Revenues website.

    Does this mean we can each avail of the up to 14k rent a room relief? I can’t see anything that says otherwise on their website.


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    #18
    L-M
    Registered Users Posts: 23,694 ✭✭✭✭L-M


    “ The rent relief is available per household rather than per taxpayer, so where two parties are eligible for the relief – eg a husband and wife – the limit remains €14,000.”

    https://www.google.com/amp/s/www.irishtimes.com/looking-to-earn-14-000-tax-free-get-that-spare-room-ready-1.3190941

    Also, remember if you plan on taking in more than €14,000, ie if your rent amounts to €14,001 then the entire amount is taxable, not just the over and above.


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