If you rent out property, then you probably already know that you are liable to pay rental income tax. But there is a little more to it than that…
There are several requirements that landlords should be aware of, from their obligation to register with the Residential Tenancy Board, to the obligation to submit income tax returns. Due to restrictions on tax relief on mortgage interest, together with the fact that the capital element of the mortgage is not tax deductible, renting a property can give rise to an unexpected taxable profit. For taxpayers that are already in receipt of other income, this profit can lead to a tax liability.
For some landlords, the process is difficult and overly time-consuming. At Accountant Online, we can help ease the stress of this process. We can complete rental income accounts and tax returns, and advise on the expenses that Revenue allow to be deducted.
Other rental income tax scenarios
Rental Property Tax
- If you receive rental income from properties, including Airbnb, you should file a tax return declaring any income earned.
- If you are an Irish Landlord not resident in Ireland, your tenants have an obligation to deduct tax. They can remit it to Revenue, unless you have an agent appointed in the state.
- If you are resident in Ireland, but rent out property abroad, you should also declare any rental income earned in a tax return to Revenue
- If you find yourself in the situation where you have been in receipt of rental income for some time and are now concerned about notifying Revenue due to potential interest and penalties – our advice would be to contact us with the details and we can advise on the best way to declare the information, while at the same time minimizing any exposure to penalties
Larissa is a Fellow Chartered Accountant (FCA) and is the Founder and CEO of Accountant Online, which specialises in company formation, company secretarial, annual accounting services, bookkeeping, tax, and payroll services for micro and small companies in Ireland, Northern Ireland and the UK.
Larissa has been shortlisted for the Image ‘Businesswoman of the Year Award’ in 2017 and 2018 and awarded ‘Accountant of the Year’ in 2018. Larissa volunteers as a role model for LEO Donegal’s ‘Ambition’ programme and is a Lead Entrepreneur for ‘ACORNS’ and ‘Going For Growth’ which are development programmes designed to support ambitious female entrepreneurs, and for ‘Back For Business’, a development programme assisting returned emigrants or those planning to return to Ireland to start and develop a business. Accountant Online has won many awards, including ‘Best Small Practice’ in 2017, ‘Best Medium Practice’ in 2018, and in 2020, ‘Medium Practice of the Year’ and ‘Practice of the Year’.