1st time purchase advice with section 23

S

saz

Guest
Hi all
Looking for some advice on 1st time purchase under section 23.
How do I work out how section 23 status helps me?

Purchase price is €240k for 2 bed appartment, salary €63k#

thanks in advance
 
What's your rental come? A portion of the cost of an S23 property can be offset against rental income. If you have no rental income, or the rental income is below the interest you're paying on the mortgage (you can offset all interest against rental income on all rental properties) then the value of the S23 to you is zero, otherwise the benefit is the amount of rental income you would otherwise pay in tax.
 
Totally agree with Howitzer. Sec 23's are often miss sold to people on the basis of the tax break.
Sec 23 relief applies on any profit you make. So when interest, management fees, maintenance fees are taken away, there should not be a lot of profit left. Therefore you are paying a lot of money for a tax shelter that will take you years (more than 10) to derive any meaningful benefit from. Sec23 were a god send for people that have lots of rental income and lots of taxes on their profits-in some cases they are able to save 5 figure sums in tax in the year of purchase of the sec 23.
My advice if you are new to this, is to avoid sec 23 and buy a standard property. They are better value, often better located(but not always) and definately easier to sell-generally! No certainties in anything!!
 
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