If you rent a property in Ireland but you’re a resident of any other country worldwide, you are what we call a non-resident landlord.
If you’re getting rent from your property in Ireland, the money you’re making comes under Irish taxation law, and so you’re required to complete an Irish tax return to declare that rental profit. For first-timers (and even experienced Landlords), Irish tax rules can feel like tricky waters to navigate.
So here’s what you need to know about the rules themselves:
What exactly is your rental profit?
When we say ‘rental profit’ we mean your gross rental income, minus your allowable deductions. If you’re not sure what deductions you’re entitled to, here’s a handy guide.
What tax will you pay on it?
As standard, you will pay 20% tax on your rental profit, but this can be affected by your personal circumstances. For example, you may have some personal tax credit to claim to reduce the liability. Also, as a non-resident Landlord, you won’t need to pay Pay Related Social Insurance (PRSI) which will save you 4%, and you’ll only pay Universal Social Charge (USC) if you’re earning a profit in excess of €13,000.
When will you need to pay?
Let’s say you first rent the property in 2019. In this case, your tax return will need to be completed within 10 months of the end of the tax year, meaning you have until the 31st of October 2020.
In this example, you’d also have to pay preliminary Income Tax for the current tax year 2020 by the 31st of October 2020. This is based on paying 100% of the previous tax year’s liability (i.e 2019). Therefore it is best to calculate your tax early in 2020 so that you can plan and budget well in advance of the deadline.
What if the property is jointly owned?
If the property is owned jointly then each owner may have to do a tax return. This could lead to tax savings.
What if you have a letting agent?
Your letting agent is legally obliged to submit a form to Revenue confirming the amount of rent you get from each property. Therefore, in a lot of cases, Revenue will know what rents you are earning and they will eventually catch up with you.
How we make the process stress free, in 10 steps
We support many non-resident landlords worldwide with their tax returns so that they can relax knowing their taxation requirements are in expert hands.
Here’s exactly what we do:
- We meet! We get to know you, and you get to know us. We charge for this first discovery meeting so that we can give you the most value in this session, regardless of whether we go any further. Read more about why we charge for our first meeting here. In this session, we’ll discover as much as we can about your unique personal circumstances and the property you own.
- We run through a detailed property checklist – This gives us a tonne of information about your property and helps us to minimise taxes where possible. A good example: We’ll ask If your property is a furnished letting. If it is, we can claim Capital Allowances, which will reduce your tax liability. We’ll look at how long ago you repaired or renovated the property to see if we can reduce Capital Gains Tax on a future sale.
- With all the information, we’ll give you a detailed proposal – So that you know what you need, and what it’s going to cost. Remember some of our fees are tax-deductible too. Once you accept the proposal, we’ll get the basic housekeeping out of the way first (asking for some ID, a household bill, payment information)
- We become your tax agent! – We get you registered for taxes with the Revenue, and all future Revenue queries will come directly to us, so you can officially relinquish all worry about what you need to do!
- We’ll start calculating your Rental Profit and Capital allowances – and following this, we’ll calculate your Income Tax and prepare your return.
- We’ll send your return to you to sign off on – We’ll e-mail a cover letter over to you which confirms your tax liability and your preliminary tax liability for the current tax year. With that letter will be your tax return for signing. (You’ll sign electronically so that it’s easier and saves you time printing and scanning).
- Once signed, we’ll get the return filed with the Revenue – processing the tax payments you’ve given us permission to put through.
- A few days later… we get it back – We’ll get the assessment back from the Revenue, which we’ll check over.
- We send the assessment to you – so that you have a copy, and as a confirmation that our service is complete.
- We all have a cup of tea and relax – safe in the knowledge that you’re fully compliant with the revenue, and everything is taken care of.
Let us do the worrying for you
In the event that the Revenue follows up with any queries about your return or rental computations, we’ll take care of the situation quickly and efficiently for you.
We’ve been fortunate to help clients all over the world to get this necessary bit part of Landlord life sorted. France, Croatia, Brunei, Spain, Australia, Qatar, and Dubai to name just a few.
Wherever you are in the world, don’t feel alone in worrying about this – our experience will cover you.
Need more reassurance from people who’ve been where you are? Have a read of some testimonials from our existing Non-Resident clients on our dedicated landing page.
Want to skip right to that first meeting? Get in touch.