Landlord. Hap scheme worth it?

bcoll05 · 10-03-2020 9:01am #1

Hi.
I am a landlord of an old 1950s terraced house. Its a 2 bedroom but recently renovated 8 years ago to a good standard.
I have a very good tenant in the house a couple of years now. He recently asked would I be able to join the Hap scheme as he has been granted it.
I dont know much about it.
Any landlords out there?
I want to know is it to much hassle to get set up on the scheme. Is it worth it?
Anyone with an older house like mine find it harder bringing the house up to council standard? Galway area.

Fol20 · 10-03-2020 9:14am

There is a lot of paperwork and hassle to it.

They’re is a chance that the council may inspect your property in a year or more and if it fails, you need to fix the issues they identify(some of which might cost thousands)

You can’t accept decline HAP especially for a tenant already in your house so your stuck with it.

overkill602 · 10-03-2020 9:18am

many treads on this in fact done to death hassle sure, might cost and as tenant in place cant refuse on discriminatory ground BS. "up 2 gov 2 house state dependents"
smaller council area might have wriggle room Dublin not

Del2005 · 10-03-2020 9:30am

You can't refuse HAP but what happens if the landlord does not provide the documents required and the tenant stops paying rent, can the landlord start the eviction process?

overkill602 · 10-03-2020 10:10am

Del2005 wrote: »

You can't refuse HAP but what happens if the landlord does not provide the documents required and the tenant stops paying rent, can the landlord start the eviction process?

Yes but that when the delinquent tenant protections kick in and delay delay

bcoll05 · 10-03-2020 10:16am

Thanks everyone.
The only benefit on my side is I never upped the rent in a couple of years because the tenant was so good. Talking to an estate agent yesterday on this subject she said I should be getting 200e more per month. So if I was to join Hap I will increase the rent.
Im more worried about the changes.
- Drilling holes for ventilation even tho the house is breezy enough.
- Wiring the smoke alarms.
- Safety latches on windows.
Has anyone had to go through these changes or what did they make you adjust/change?

Iscreamkone · 10-03-2020 10:20am

You will need a Cert from an electrician certifying the safety of the electrics. For an old house this could be expensive, especially with necessary upgrades

bcoll05 · 10-03-2020 10:29am

Iscreamkone wrote: »

You will need a Cert from an electrician certifying the safety of the electrics. For an old house this could be expensive, especially with necessary upgrades

Ah f##k.
How does an electrician check that? Is it a big job?

JustMe,K · 10-03-2020 11:17am

You also need a tax compliance certificate, and once the council have made payments totalling 10k to you, they will stop if you have not provided that cert.

HAP is paid in arrears not in advance like most leases, so the tenant will have to come to some arrangement with you on that unless the council are going to make it up. I don't know if you are in a RPZ, but if so you might not be able to increase the rent by €200 per month.

But as has been said, you don't have much choice. The council might never inspect the property though, but I don't know what happens if they do and you simply tell them you cannot afford to do the works.

JustMe,K · 10-03-2020 12:59pm

bcoll05 wrote: »

Thanks for all that. That is all new information for me regarding 10k & certs. The cert... what is that? I am employed & the company sort out all my tax so everything is above board. I haven't paid tax tho on the rent. What will I ha e to do there?

No not in rpz at the moment but the estate agent has said to notify the tenant as soon as possible that I am upping the rent because it could be in an rpz area soon.

The tax compliance cert is from Revenue to basically say all your affairs are in order. You can order one online through ROS (or your accountant can). Presumably if you are not paying tax on the rent then you are not declaring the income in your end of year returns, and you don't have the tenancy registered with PRTB? If thats the case I am not sure what your next steps should be.

bcoll05 · 10-03-2020 1:05pm

JustMe,K wrote: »

The tax compliance cert is from Revenue to basically say all your affairs are in order. You can order one online through ROS (or your accountant can). Presumably if you are not paying tax on the rent then you are not declaring the income in your end of year returns, and you don't have the tenancy registered with PRTB? If thats the case I am not sure what your next steps should be.

Thanks justme,k I'll get on to a friend of mine he is an accountant. Probably have to back date it or something.

Del2005 · 10-03-2020 1:31pm

bcoll05 wrote: »

Thanks justme,k I'll get on to a friend of mine he is an accountant. Probably have to back date it or something.

And large interest penalties. The tax is on your PAYE income so 50% of the rent in tax if you are paying the top rate of tax.

This will cost you a fortune in back tax, which you would most likely be caught for anyway, and bringing the property up to current building regulations, not the regulations from when it was built for every other residential property, as IIRC the councils are concentrating on inspecting HAP properties.

the_syco · 10-03-2020 11:25pm

bcoll05 wrote: »

He recently asked would I be able to join the Hap scheme as he has been granted it.

You are not allowed to say now to HAP. You will get a fine if you say no to HAP. Don't say no to HAP, or you'll get a fine.

bcoll05 wrote: »

No not in rpz at the moment but the estate agent has said to notify the tenant as soon as possible that I am upping the rent because it could be in an rpz area soon.

Up the rent. If the tenant decides to leave, then so be it. Once the area goes RPZ, you'll find it hard clawing back the lost rent.

Del2005 · 11-03-2020 1:01am

the_syco wrote: »

You are not allowed to say now to HAP. You will get a fine if you say no to HAP. Don't say no to HAP, or you'll get a fine.

Up the rent. If the tenant decides to leave, then so be it. Once the area goes RPZ, you'll find it hard clawing back the lost rent.

Problem is that the OP can't provide the required documents so can't do HAP if they wanted to.

Best option for the OP is to increase the rent so much that the tenant has to leave and hope that Revenue don't catch them.

lcwill · 11-03-2020 1:33am

Del2005 wrote: »

Problem is that the OP can't provide the required documents so can't do HAP if they wanted to.

Best option for the OP is to increase the rent so much that the tenant has to leave and hope that Revenue don't catch them.

Then I suggest he just sells the property once it's empty, unless he wants to take being a landlord a bit more seriously and pay taxes.

Always amazed when people come on here openly admitting to not paying tax on rent. How can the revenue not track these people down more easily?

They should be able to work out when a house is occupied by someone who is not the owner, and if the tenancy is not registered and no tax is being paid then it should be red flagged in the system to be checked out.

bcoll05 · 11-03-2020 7:44am

the_syco & del2005 thanks for your helpful advice.

Its looking like I'll have to join the scheme. I've been looking into some of the alterations that may need to be done to the property & im well able to do them myself or know people that can help me. Paperwork is my downfall.
Thanks again.

godtabh · 11-03-2020 8:21am

bcoll05 wrote: »

the_syco & del2005 thanks for your helpful advice.

Its looking like I'll have to join the scheme. I've been looking into some of the alterations that may need to be done to the property & im well able to do them myself or know people that can help me. Paperwork is my downfall.
Thanks again.

I don’t think just the paper work will be your problem

bcoll05 · 11-03-2020 8:35am

godtabh wrote: »

I don’t think just the paper work will be your problem

How so?

The_Conductor · 11-03-2020 12:57pm

bcoll05 wrote: »

How so?

You'll have to pay penalties and interest on the undeclared rental income to Revenue (for starters). Also- you will have to bring the property up to current building standards- rather than the standards such as they were when the property was built- in order to pass a HAP inspection (which is being prioritised by local authorities).

A HAP inspection- is a wish list on the part of local authorities- which tends to mirror current building regulations.

So- it would include heating in every 'habitable room'.
Outside ventilation in all habitable rooms.
Safety windows for bedrooms (easily done in all fairness)
Windows and ventilation for bathrooms
Ventilation for cooking

etc etc

In general- the biggest part of this will be having Holemasters out for a day or two drilling ventilation in walls for you- unless you're unlucky enough to have a bathroom without a window, bedroom without a window, non-compliant wiring or plumbing etc etc

It could potentially be quite a bit of work.

First off- ring Revenue, confess that you haven't been declaring your rental income- and take the punishment on the nose.

Claw Hammer · 11-03-2020 1:49pm

The_Conductor wrote: »

First off- ring Revenue, confess that you haven't been declaring your rental income- and take the punishment on the nose.

Rather than ringing the Revenue, the better course of action would be to get yourself an accountant who was familiar with Revenue arrears cases. There will be able to advise you on how to put your affairs in order and negotiate the best deal with the Revenue for you.

bcoll05 · 11-03-2020 2:43pm

The conductor & claw hammer. Thank you for your useful information. I will take all that on board.

Ya im sourcing an accountant at the moment to discuss the whole situation with & sort something out before I make a decision.

The ventilation... I can do that myself I've a trade background. Thanks tho for the run down on the requirements. That's probably the biggest manual work I can think of.

gibgodsman · 11-03-2020 4:07pm

As a tenant, ill give my opinion, I wasn't on the Hap for the first 3 years, then went on it, nothing changed, they didnt ask for anything to be installed, only had our HAP inspection last year, 4 years into being on the HAP

All they asked was that a fire blanked and evacuation plan be installed, live in an apartment, the inspector was really nice and doesn't work for the council, they are a 3rd party.

The pros for you are that your will get paid on time and in full without hassle and your tenant will stay for a minimum of 2 years everytime they reapply for the HAP

gibgodsman · 11-03-2020 4:13pm

Also, just seen you didn't pay any taxes on your rental income for this long? Wow, you are in some serious financial trouble when they catch you, and they 100% will now, good luck mate, I appreciate your honesty on here but you can never cheat the tax man

Graces7 · 11-03-2020 5:28pm

gibgodsman wrote: »

As a tenant, ill give my opinion, I wasn't on the Hap for the first 3 years, then went on it, nothing changed, they didnt ask for anything to be installed, only had our HAP inspection last year, 4 years into being on the HAP

All they asked was that a fire blanked and evacuation plan be installed, live in an apartment, the inspector was really nice and doesn't work for the council, they are a 3rd party.

The pros for you are that your will get paid on time and in full without hassle and your tenant will stay for a minimum of 2 years everytime they reapply for the HAP

Good to have some really positive input

bcoll05 · 11-03-2020 7:55pm

gibgodsman wrote: »

As a tenant, ill give my opinion, I wasn't on the Hap for the first 3 years, then went on it, nothing changed, they didnt ask for anything to be installed, only had our HAP inspection last year, 4 years into being on the HAP

All they asked was that a fire blanked and evacuation plan be installed, live in an apartment, the inspector was really nice and doesn't work for the council, they are a 3rd party.

The pros for you are that your will get paid on time and in full without hassle and your tenant will stay for a minimum of 2 years everytime they reapply for the HAP

Thanks for all that. My house is in great condition & that's all down to my tenant. I want to keep him that's why im on here looking for information on how we can work together so we both are happy.
As for the tax, ya I know something bad is probably going to come up. The taxman is never good news.

The_Conductor · 11-03-2020 8:00pm

Honesty is the best policy with Revenue. There is an element of discretion associated with their penalties (which can be a multiple of the actual tax due). Don't play games with them- its not worth it. Deal in facts- and be damn sure of your facts.

Del2005 · 11-03-2020 8:01pm

gibgodsman wrote: »

The pros for you are that your will get paid on time and in full without hassle and your tenant will stay for a minimum of 2 years everytime they reapply for the HAP

That's not true. If the tenant doesn't pay their portion to the council the Landlord doesn't get paid and due to data protection laws the landlord can't get any information from the council.

The_Conductor · 11-03-2020 8:04pm

Del2005 wrote: »

That's not true. If the tenant doesn't pay their portion to the council the Landlord doesn't get paid and due to data protection laws the landlord can't get any information from the council.

Plus its paid in arrears- rather than in advance, like you'd get from any other tenant.

ted1 · 11-03-2020 9:41pm

bcoll05 wrote: »

Thanks for all that. That is all new information for me regarding 10k & certs. The cert... what is that? I am employed & the company sort out all my tax so everything is above board. I haven't paid tax tho on the rent. What will I ha e to do there?

How have you not be declaring the rent received to the taxman. I don’t think you are that niave to think you didn’t have to pay tax.

You may be un for a big penalty.

I’m guessing you are not registered with the RTB? Have you been paying property tax ?

bcoll05 · 11-03-2020 11:36pm

I was living in the house with the tenant. He pretty much had the run of the place as I barely stayed there (living between there & my girlfriend's). So I was told about this hole rent a room thing. I was told I didn't have to pay tax. I got married over Xmas & now he has the property solely to himself. I've properly moved out. We're arranging a proper lease now. He wants to go through Hap.

Del2005 · 12-03-2020 12:04am

bcoll05 wrote: »

I was living in the house with the tenant. He pretty much had the run of the place as I barely stayed there (living between there & my girlfriend's). So I was told about this hole rent a room thing. I was told I didn't have to pay tax. I got married over Xmas & now he has the property solely to himself. I've properly moved out. We're arranging a proper lease now. He wants to go through Hap.

You might not be that bad then if it was your PPR and you were renting a room, but you'll still need an account as you were supposed to make tax returns for the income.

the_syco · 12-03-2020 1:41am

bcoll05 wrote: »

I got married over Xmas & now he has the property solely to himself. I've properly moved out. We're arranging a proper lease now. He wants to go through Hap.

Before doing a "proper lease", talk to an accountant about Capital Gains Tax if you're even thinking of selling the place in the next 5 years.

Brego888 · 12-03-2020 10:14am

I wouldn't be too hard on the OP. Not everyone peruses that likes of this forum everyday and therefore wouldn't be familiar with declaring income on rental properties, rent a room schemes, CGT, RTB etc.

OP definitely get hold of an accountant that is familiar with the process but the fact that it was your primary residence until very recently you shouldn't be too bad in relation to fines and back pay of taxes.

Fol20 · 12-03-2020 11:14am

Graces7 wrote: »

Good to have some really positive input

It can go well depending on the situation. I just think the risks outweigh the positives. You are taking a gamble with the inspection as you might be 3 years into a lease when they may or may not say you need to fix x and y.

This might be small but I personally find it annoying where every month i have two transactions for hap tenants. The main transaction from the government and the tenant paying a small top up as well. If you have one rental. You may not mind this but if you have more than one, it can be annoying especially if the tenant regularly forgets to send us small top up.

ted1 · 12-03-2020 11:49am

Fol20 wrote: »

It can go well depending on the situation. I just think the risks outweigh the positives. You are taking a gamble with the inspection as you might be 3 years into a lease when they may or may not say you need to fix x and y.

This might be small but I personally find it annoying where every month i have two transactions for hap tenants. The main transaction from the government and the tenant paying a small top up as well. If you have one rental. You may not mind this but if you have more than one, it can be annoying especially if the tenant regularly forgets to send us small top up.

So issue rent arrears notice as soon as you can.

https://ipoa.ie/rent-arrears-procedure/

Fol20 · 12-03-2020 5:24pm

ted1 wrote: »

So issue rent arrears notice as soon as you can.

https://ipoa.ie/rent-arrears-procedure/

We are talking about under 50euro that one of my tenants forgets to pay on a regular basis.

It’s not worth my time to do a notice because the figure is so small and a tenant would be stupid to create so much hassle for themself over small money.

Claw Hammer · 12-03-2020 5:49pm

Fol20 wrote: »

We are talking about under 50euro that one of my tenants forgets to pay on a regular basis.

It’s not worth my time to do a notice because the figure is so small and a tenant would be stupid to create so much hassle for themself over small money.

It is well for people who can afford to be blasé about €50.

Cuddlesworth · 12-03-2020 7:37pm

Fol20 wrote: »

We are talking about under 50euro that one of my tenants forgets to pay on a regular basis.

It’s not worth my time to do a notice because the figure is so small and a tenant would be stupid to create so much hassle for themself over small money.

Just curious, if its checked and the council see missed payments, would they stop the payments to the landlord?

Yellow_Fern · 12-03-2020 7:43pm

The_Conductor wrote: »

You'll have to pay penalties and interest on the undeclared rental income to Revenue (for starters). Also- you will have to bring the property up to current building standards- rather than the standards such as they were when the property was built- in order to pass a HAP inspection (which is being prioritised by local authorities).

A HAP inspection- is a wish list on the part of local authorities- which tends to mirror current building regulations.

So- it would include heating in every 'habitable room'.
Outside ventilation in all habitable rooms.
Safety windows for bedrooms (easily done in all fairness)
Windows and ventilation for bathrooms
Ventilation for cooking

etc etc

In general- the biggest part of this will be having Holemasters out for a day or two drilling ventilation in walls for you- unless you're unlucky enough to have a bathroom without a window, bedroom without a window, non-compliant wiring or plumbing etc etc

It could potentially be quite a bit of work.

First off- ring Revenue, confess that you haven't been declaring your rental income- and take the punishment on the nose.

I wonder how many houses have had their energy efficiency scalped by this requirement. Such a backward requirement.

Del2005 · 13-03-2020 8:35am

Cuddlesworth wrote: »

Just curious, if its checked and the council see missed payments, would they stop the payments to the landlord?

The council don't care about the co-payment. If the tenant stops paying their share to the council the landlord finds out when they don't get the HAP payment with no ability to find out why due to data laws.

Yellow_Fern wrote: »

I wonder how many houses have had their energy efficiency scalped by this requirement. Such a backward requirement.

My brother got the cavity insulation done on his house and there was a solid concrete pillar about 0.5mx0.5m beside the front door, to get the grant he had to insulate this section. Another part of getting the grant was to drill 0.15m holes in every room in the house and you can't use closable vents!

Fol20 · 15-03-2020 12:47am

Claw Hammer wrote: »

It is well for people who can afford to be blasé about €50.

Well, I’m just pointing out the fact that compared to others that have to pay at least 1500. This figure is factually less.

Fol20 · 15-03-2020 12:49am

Cuddlesworth wrote: »

Just curious, if its checked and the council see missed payments, would they stop the payments to the landlord?

Not sure about this aspect as I have continued to receive payments from the government. It’s more about the additional top up directly from tenant. I have also advised them to just set up a standing order so they can forget about it and it would automatically be sent.

Mic 1972 · 17-03-2020 7:13pm

bcoll05 wrote: »

Thanks everyone.
The only benefit on my side is I never upped the rent in a couple of years because the tenant was so good. Talking to an estate agent yesterday on this subject she said I should be getting 200e more per month. So if I was to join Hap I will increase the rent.
Im more worried about the changes.
- Drilling holes for ventilation even tho the house is breezy enough.
- Wiring the smoke alarms.
- Safety latches on windows.
Has anyone had to go through these changes or what did they make you adjust/change?

They are not expensive upgrades you are talking about there
I have battery smoking alarms, no wire - 20 euro in Woody's

The_Conductor · 17-03-2020 7:41pm

Has anyone been asked to install 'heat sensors' as opposed to 'smoke alarms'?
They're not massively expensive- but wiring the sensors together is a bit of a chore.

Jasper79 · 17-03-2020 7:51pm

I received a letter Monday saying my tenant is now on hap. I completed the forms some weeks ago.

I've 2 issues with it.
1) the rental figure is about 150pm lower than what tennant is currently paying. Does the tennant pay the balance themselves?
2)they state rent is paid last weds of month in arrears. the lease is for rent to paid 2nd of month for month in advance. Can they change the terms of the lease?

Claw Hammer · 18-03-2020 12:07pm

Fol20 wrote: »

Well, I’m just pointing out the fact that compared to others that have to pay at least 1500. This figure is factually less.

That doesn't mean that €50 is to be sniffed at.

JustMe,K · 18-03-2020 12:39pm

Jasper79 wrote: »

I received a letter Monday saying my tenant is now on hap. I completed the forms some weeks ago.

I've 2 issues with it.
1) the rental figure is about 150pm lower than what tennant is currently paying. Does the tennant pay the balance themselves?
2)they state rent is paid last weds of month in arrears. the lease is for rent to paid 2nd of month for month in advance. Can they change the terms of the lease?

1) the figure is probably their limit for their circumstances. HAP allows tenants to top up their rent, which previous schemes did not, so yes, your tenant is responsible for paying the difference or you follow normal rules for non payment of rent
2) this is a problem with HAP. Your tenant needs to bring themselves up to date (and I believe they can get assistance with this), otherwise they are permanently in rent arrears. Either the tenant or HAP should be making a payment to you to cover the in between period that regular HAP does not cover.

Yellow_Fern · 18-03-2020 1:34pm

Del2005 wrote: »

The council don't care about the co-payment. If the tenant stops paying their share to the council the landlord finds out when they don't get the HAP payment with no ability to find out why due to data laws.

My brother got the cavity insulation done on his house and there was a solid concrete pillar about 0.5mx0.5m beside the front door, to get the grant he had to insulate this section. Another part of getting the grant was to drill 0.15m holes in every room in the house and you can't use closable vents!

Mad stuff! I checked with an expert in ventilation and he explained there is no building regulation requiring cooker hoods to have external ventilation on all houses. Its probably required on naturally vented houses but certainly not if there is mechanical ventilation.

Barelysane2019 · 23-03-2020 10:01pm

I went through this last year as a landlord. Paperwork was simple and they processed the application extremely quickly. As others have mentioned, you just have to apply through revenue online for a tax clearance cert which is quick and easy too (although I had already been paying income tax).

I find it fantastic and I’m blessed with really good tenants. Rent is paid straight into your account on the last Wednesday of every month. Its a great relief at crazy times like this knowing that your rent will be paid by the council.

I understand that there are downsides in that if the tenant stops paying the council they stop paying you but it sounds like you have a good tenant too and wouldn’t have to worry about this.

The inspection happened very quickly, within a couple of months. I got a list of things to correct - bathroom extractor fans (which were working but they hadn’t turned on properly), fire blanket which was there but not mounted correctly and the requirement for a clothes dryer which I argued about as there was no space for one and the tenant specified that they didn’t want and wouldn’t use one. I had supplied an air dryer already.

Hopefully this helps to put your mind at rest. There’s a lot of negativity around HAP so I thought I’d share a positive story.

Coolaboy · 25-03-2020 9:41am

Looking for HAP Top Up from Housing Section. Hi folks. I have tenants in my house and recieve 625 a month payment from HAP. The house is in Westmeath. As they were good tenants I never looked for a payment from them. I hear there is an additional 20% top up from HAP as rents have gone up year on year. Average rent in the estate is 850 a month. I'd rather not ask the family in the house for additional payment if there is a top up available from Housing section. Any advice please.

Landlord. Hap scheme worth it?

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