Return for one house landlord

Sheep Shagger · 17-10-2015 10:30pm

Get an accountant - wish I had previously, about to start using one. Barely cover my costs each month but have a €2k bill due at the end of this month (reduced interest amount to use as offset, not being able to write off property tax and the introduction of USC on rental income being the biggest killers).

Can't help thinking thousands of accidental landlords think if they don't make a profit each month then they don't have a tax bill - couldn't be further from the truth (even after all the deductions).

Arbiter of Good Taste · 17-10-2015 10:49pm

Howjoe1 wrote: »

To clarify, I am AITI qualified. Qualified enough?

So am I, probably a lot longer than you are

Sheep Shagger · 17-10-2015 11:09pm

Arbiter of Good Taste wrote: »

So am I, probably a lot longer than you are

Lads, can you hsve the pissing contest somewhere else please?

riclad · 18-10-2015 12:18am

IF you have have any rental income ,one week,
1 month, you have to make a tax return,
fill in the self assesment tax return online ,or
on the paper form.
Then its up to the revenue to decide if you have made a profit .
is the rental income more than the tax allowance s,and expenses ,
on the rental property.
and the mortgage interest 75 per cent of loan interest.
Say you rent for six months ,
then claim for the expenses for that 6months .
ie half the annual tax interest ,
using the 75 per cent of interest formula .
IF you make no tax return you can be fined for that ,
even if the tax due is 100 euro.
i would expect to pay an accountant 200 euro plus vat at least , for any tax return .

Pawwed Rig · 18-10-2015 8:45am

riclad wrote: »

Then its up to the revenue to decide if you have made a profit .

Incorrect. Under a self assessment system the onus is on you to declare your taxable income. Revenue assume that you have full knowledge of tax law or sought the advice of a competent professional and have filed the return correctly. As I said previously you can put whatever you like in a tax return but it is upto you to justify these entries in the event of an audit.

Cost wise is a difficult one. Where a large firm is doing it you won't pay less than €500 + VAT. Doing it myself I wouldn't do it for a stranger for less than €300 with no VAT. Bear in mind I would have to pay 50% of this to Revenue on my own income tax return.
Obviously for friends/family I would charge less or nothing.

Barr · 18-10-2015 11:00am

MayBee wrote: »

I'm following this thread with interest as I will be making my first tax return also this year, and unfortunately have left it very late, I was thinking of using an online tool to do the return, not sure if I can mention the website, has anyone any experience of this, thanks in advance,
Also my property was only rented for 6 months, so do I do everything pro rata ?

What is the online tool ? There is no issue mentioning it. Anything that makes it easier would be a help

SteM · 18-10-2015 11:20am

A friend is in the same position as you op and he was quoted €300+vat too.

Barr · 18-10-2015 12:16pm

Just talking to my OH there. She was the one talking to the accountant on Friday.

Its seems that the accountant sends out a list of documents required. We return these by email.

There seems to be no physical meeting.

I always thought there would be a consultation etc.

Is this the usual mechanics of how things work ?

MayBee · 18-10-2015 12:41pm

There are a couple of options to do it online with paylesstax.ie, I was thinking of using the cheapest one of this which is about 99 + vat, as I don't think I would mange to get an accountant at this stage, also I would really want to use someone recommended to me, but I don't know anyone who uses an accountant

MayBee · 18-10-2015 12:42pm

Barr wrote: »

Just talking to my OH there. She was the one talking to the accountant on Friday.

Its seems that the accountant sends out a list of documents required. We return these by email.

There seems to be no physical meeting.

I always thought there would be a consultation etc.

Is this the usual mechanics of how things work ?

Can I ask how much is this option costing ?

Barr · 18-10-2015 12:46pm

MayBee wrote: »

Can I ask how much is this option costing ?

This is for the quote of €300 + Vat.

prettyrestless · 18-10-2015 5:41pm

Barr wrote: »

Just talking to my OH there. She was the one talking to the accountant on Friday.

Its seems that the accountant sends out a list of documents required. We return these by email.

There seems to be no physical meeting.

I always thought there would be a consultation etc.

Is this the usual mechanics of how things work ?

Unless we are preparing full trading accounts we generally don't meet face to face with our clients when doing their tax return. A 10/15 minute phone call to discuss their various types of income, reliefs/deductions that may be applicable, etc etc is the starting point, followed by an email/letter with a list of all the items required. Then phoning them again when we have their liability calculated and explaining it.

Pawwed Rig · 18-10-2015 6:45pm

As a new client we would always meet them. Might not meet them the following year unless they wanted to though.
That said they are probably too busy to meet people at this time of year. I just spent all of this afternoon doing a clients tax return so every extra job during the week equals extra time I need to work on the weekends.

riclad · 18-10-2015 9:36pm

IF you think you are gonna make a profit,
you can a pay an accountant 300 euro to do your accounts,
i think the accountants ,fills in your expenses on the form .
one of which will be the 300 euro fee .
Your taxable income is rental income, minus 75 per cent of loan interest paid,
and various expenses incurred,on the rental home. insurance,
maintenance, prtb fee

https://www.taxback.com/blog/irish-landlord-expenses

It's tax-deductible if you've paid a professional to provide you with any legal or accounting services relating to your property - to have leases drawn up or to aid you with Stamp Duty, for example, or to prepare rental accounts .
he will need a document stating your paye income, before tax,
he will need to see your rental income ,
for the tax year,
An accountant will need ,
A document showing your loan interest paid on the home loan.
,documents ,receipts, or at least a summary of all your expense,s
that you are claiming for the rental unit.
You have to keep all documents ,receipts etc for 4-5 years
In case the revenue should wish to audit you .
if you are paying for boiler service etc get a receipt .
get a full receipt for any repairs or anything you buy ,
curtains etc in respect of the rental house.

Bold Abdu · 19-10-2015 2:42am

I would generally always meet a new client. It's kind of a 2 way interview I suppose.

Although it's a busier time of the year I've never turned a client away or increased the fee because it's close to the deadline.

I've taken over numerous clients who previously completed their own Returns. I wouldnt say they were all riddled with errors, but they are never correct.

HerbieJ · 19-10-2015 7:24am

Depending on the amount you just be able to file a form 12. I've done this the last few years and it's quite straight forward. Ive looked at the figures for next year and I will have to file a form 11 as I will exceed the amount allowed for the 12, think ill budget for an accountant to do this as the form looks a lot more daunting and really it only costs half the amount.
I also agree revenue seem to be sending letters lately I know of two people renting out their homes that got these letters and had not declared anything. I wonder if they have access to irish water database or something.

Pawwed Rig · 19-10-2015 7:27am

HerbieJ wrote: »

Depending on the amount you just be able to file a form 12. I've done this the last few years and it's quite straight forward. Ive looked at the figures for next year and I will have to file a form 11 as I will exceed the amount allowed for the 12, think ill budget for an accountant to do this as the form looks a lot more daunting and really it only costs half the amount.

If you are happy that you have done the Form 12 correctly the Form 11 is no more difficult. It asks for the same info. If you use ROS offline just click on the rental income section.

HerbieJ · 19-10-2015 8:06am

Pawwed Rig wrote: »

If you are happy that you have done the Form 12 correctly the Form 11 is no more difficult. It asks for the same info. If you use ROS offline just click on the rental income section.

Thanks for that, I did have an accountant friend look over my returns when I first did them so they should be fine. I might give it a go but do it a lot earlier this time in case I run into issues. Now I just need to save as I'll have to pay tax on the double the first time I file, isn't that correct?

Pawwed Rig · 19-10-2015 9:04am

Yeah you will need to pay preliminary tax for the next year too so doubling up is the
easiest way.

sunnysoutheast · 19-10-2015 10:07am

HerbieJ wrote: »

I also agree revenue seem to be sending letters lately I know of two people renting out their homes that got these letters and had not declared anything. I wonder if they have access to irish water database or something.

I would say it's more likely to be an analysis of who is paying the LPT for a given property, given there are very high compliance rates with that charge. If the same person crops up against multiple properties then there are only a few possible explanations.

Barr · 19-10-2015 2:49pm

Just off the phone with revenue there.

It seems the deadline of 31st Oct does not apply if it is your first return.

Because I am PAYE at the moment the deadline only applies if you are already self assessed.

Once I send the form in , it is up to revenue how they want to assess me. Something to do with the amount of income etc.

They said I just need to complete “FORM 12” and that is it.

Sheep Shagger · 19-10-2015 8:17pm

I used to be treated as PAYE but as my rental 'profit' (rental income less expenses/allowable deductions) is now more than €3174 (think that's the number) I'm now classed as self assessment and had to complete a form 11.

Not allowed to offset tax bill against tax credits now it seems either (as I'm no longer looked after under the PAYE system).

Have filed for 2014, just have the cough up the money, am in process of getting an accountant for 2015 (preliminary tax due v soon).

MayBee · 19-10-2015 10:23pm

Excuse my ignorance but what's this preliminary tax business, why / when would this be due ?

Also I'm not currently working, so technically not paye, I assume I can still do my return on form 11, as it happens I would have very little in the way of deductions, house only rented for 5 months of 2014.

I've a feeling this isn't going to end particularly well

Bold Abdu · 20-10-2015 3:40am

MayBee wrote: »

Excuse my ignorance but what's this preliminary tax business, why / when would this be due ?

Also I'm not currently working, so technically not paye, I assume I can still do my return on form 11, as it happens I would have very little in the way of deductions, house only rented for 5 months of 2014.

I've a feeling this isn't going to end particularly well

Preliminary tax is a payment on account for the current year. So you're filing 2014 now (deadline 31/10/15) but you need to pay preliminary tax on account for 2015 by the same date.

You'd often calculate PT as 100% of the previous years liability but in your case with only 5 months rent in 14 and not currently working, this would not be the best method.

Barr · 26-10-2015 7:01pm

Quick question on the 12.5% allowable on fixtures and fittings over 8 years .

I’m just wondering would the kitchen, bathroom suite, tiling , flooring be allowable in this category?

Pawwed Rig · 26-10-2015 7:51pm

Barr wrote: »

I’m just wondering would the kitchen, bathroom suite, tiling , flooring be allowable in this category?

No but keep the receipts as a capital outlay.

Barr · 26-10-2015 8:36pm

Pawwed Rig wrote: »

No but keep the receipts as a capital outlay.

Are you allowed to write off capital expenditure as well ?

Pawwed Rig · 26-10-2015 9:05pm

Depends what it is on. Some capital expenditure is allocated to the capital outlay of the property for CGT purposes whereas other expenditure can be written off against income over 8 years.
your tax advisor will know what is what.

Return for one house landlord

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