Management Agent being a private person

[salmonofdoubt]

If I were to chose a friend as my management agent, can I deduct their fee from my taxes? They are not a registered management company, nor sole trader, just a private person just like myself, and I am a landlord. I would pay them a fee (say 10%), based on the rental income. Can I deduct this fee as an expense?

Being disappointed by mediocre professional management agent companies, I would appreciate some advice.

 

[RedOnion]

nor sole trader,

Surely they would become a sole trader as soon as they start charging you a fee?

Apart from tax question, are you sure your friend isn't providing a service that is regulated by the PRSA for which they require a licence?

 

[T McGibney]

If I were to chose a friend as my management agent, can I deduct their fee from my taxes?

If they are willing to make tax returns on foot of this income, there should be no problem once there's no element of tax avoidance involved.

 

[NoRegretsCoyote]

Being disappointed by mediocre professional management agent companies

In my personal experience the main benefit of a management agent is that they have tradesmen who will take their calls as they provide repeat business. A friend can do this of course but will be no better than you at finding someone to fix a leaking tap at short notice.

 

[Vargas]

If a landlord chooses a local auctioneer to manage a rental property are their fees deductible for the income tax return?

 

[NoRegretsCoyote]

If a landlord chooses a local auctioneer to manage a rental property are their fees deductible for the income tax return?

Yes.

 

[Vargas]

Yes.

Thank you. Is this subject to a limit? The fees would be 10%+vat

 

[NoRegretsCoyote]

Thank you. Is this subject to a limit?

No. Once there is no tax evasion going on.

The fees would be 10%+vat

That sounds very much on the high side though. You shouldn't need to pay an eighth of the rent for management of an ongoing tenancy.


I've only come across fees in the 6% -8% range.

 

[Vargas]

No. Once there is no tax evasion going on.


That sounds very much on the high side though. You shouldn't need to pay an eighth of the rent for management of an ongoing tenancy.


I've only come across fees in the 6% -8% range.

But does it matter 6/8/10 if it's deductible?

 

[Gordon Gekko]

I’ve come across 10% quite regularly, but if it’s arms length and legit, it could be 20% for gold service.