Hi Folks
Take this scenario, nephew and his partner are living rent free in his aunts home since jan 2019, rental yield would be approx 2500 per month thus giving rise to tax, to note nephews gift tax threshold has been exhausted however his partner has never received a gift from her partners aunt
My understanding would be that 2500 * 12 gives a total annual rental yield of €30,000 divided by two equals 15,000 each then minus €3000 gives liability of 33% of 12,000 for nephew = €3,960 as nephews partner has not received any previous gifts she is still under the threshold therefore she has no liability for 2019, does this calculation look right and if so does nephew just make declaration in December and pay his bill of €3,960 then?
Finally not sure if relevant or not but nephew spent approx €10,000 on doing up property before they moved in, has receipts for materials to prove it, can that in any way offset against rent that is due?
Thanks for any input
Take this scenario, nephew and his partner are living rent free in his aunts home since jan 2019, rental yield would be approx 2500 per month thus giving rise to tax, to note nephews gift tax threshold has been exhausted however his partner has never received a gift from her partners aunt
My understanding would be that 2500 * 12 gives a total annual rental yield of €30,000 divided by two equals 15,000 each then minus €3000 gives liability of 33% of 12,000 for nephew = €3,960 as nephews partner has not received any previous gifts she is still under the threshold therefore she has no liability for 2019, does this calculation look right and if so does nephew just make declaration in December and pay his bill of €3,960 then?
Finally not sure if relevant or not but nephew spent approx €10,000 on doing up property before they moved in, has receipts for materials to prove it, can that in any way offset against rent that is due?
Thanks for any input