Renting your Principal Private residence

M

Morristown

Registered User
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Hi I was considering renting out my PPR for the next few years. It is worth less than what I purchased for and I was hoping to keep for 2-3 more years until it returns to what I paid. What are the tax issues involved. Or any other information that would help I would appreciate.
 
The tax issues I will leave to someone else. However, there are many issues for a landlord. Knowing and understanding the Residential Tenancies Act 2004 is the prime one. Then there is the Housing Standards requirements (though if you have been living there it should be up to scratch if you leave everything there.

Then there is the issue of non payment of rent and what do you do? Eviction of a tenant can be a long process especially if a tenant decides not to leave (over-holding). Do not expect to get your house back in the same condition as you rent it. The law on "normal wear and tear" is not what an ordinary householder would consider as being normal.

Just a few things to ponder!
 
Your problem might be CGT down the line.

As Facetious says, there are many issues to being a landlord. If you posted some actual figures it would be a good start. I presume you're being taxed at the highest rate and have a low mortgage so I'm guessing you're not going to be making much money if any on this. Or an amount that might be barely worth it.

As for hoping it will rise in value - we don't talk about the possibilities of that on here - but I can say this, you've no better crystal ball than anybody else.
 
So if you own your home for 10 years, then you rent it out for say 2 years, you pay capital gains tax on any sale? I think so according to [broken link removed]

buy it for 200K in 2005
live there 2005-2015
rent out 2015-2016
sell it for 250K..... then you have made 50K but - you will pay tax on at 30% CGT on that I believe? - so you pay ~15k tax

so you won't make any money in that type of scenario.

I'd forget about what you paid.. that is irrelevant today.
 
Reick said:
buy it for 200K in 2005
live there 2005-2015
rent out 2015-2016
sell it for 250K..... then you have made 50K but - you will pay tax on at 30% CGT on that I believe? - so you pay ~15k tax
Click to expand...
Nope - Gain is 50k and you pay tax of 30% on 2/12 of 50k which is about 30% of 8k = 2.4k.
 
Watching a TV programme last night about two guys moving to Thailand. A person could certainly let out their Dublin House and rent elsewhere in the world very cheaply. The house in Thailand was on the beach with big open plan living area, swimming pool etc. About GBP1500 per month. I am sure it could be done nearer to home...
 
Twist on the query if you were to move back into a house that was originally PPR then rented for a few years then move back in how long before it reverts to being your PPR?
 
If you live in it, it's your PPR. It reverts to your PPR the day you move back in and stop renting.
 
Does that mean that a landlord could move into a rental, declare as PPR and then put it on the market the next week and avoid CGT?
 
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