Rental Properties - Tax Obligations
Wednesday, 8th August 2012
Marie Doody owner of TaxAssist Accountants, 48 John Street, Waterford.
Question:
I have a Buy to let property, but because of the size of the mortgage, I do not make any profit from it. I am employed and have never submitted a tax return before- do I need to now?John Waterford
Answer:
This is a very common question. The short answer is yes. You are obliged to submit a tax return if you are in receipt of non PAYE income. This is irrespective of whether the property is profitable or not.
Although the rental income goes fully towards paying the mortgage you may still have a taxable profit. This is because only the interest element of the repayments is allowable as a tax deduction. Since April 2009 this has been reduced further and only 75% of the interest qualifies for a tax deduction. You must also have registered the property with the Private Residency Tenancy Board (PRTB) to claim a deduction for interest incurred.
If you have made a taxable loss on your rental property this loss can be carried forward and offset against future rental profits.
If you would like some assistance in registering with Revenue and completing your tax return, please feel free to get in touch with your local TaxAssist Accountant. We provide accountancy services in Waterford and throughout the country
Contact Marie Doody on 051 841 675 or email: This e-mail address is being protected from spambots. You need JavaScript enabled to view it.
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