Better to jointly or singly assess for tax purposes

W

wiggy

Guest
Hi
We have bought a new house and are considering renting out our current house which we have owned for 6 years. The old house is currently in both our names.

My wife has just stopped working to look after our kids. Although we are currently separately assessed for tax purposes we will move to being jointly assessed depending on the answer to this question.

My question is would we be better off to change the title deeds to be in her name only so that all the rental income would be chargeable to her and therefore would could be used against her tax free allowance and we would therefore choose to continue to be separately assessed. As i understand it that would mean most (if not all) of the rental income would be tax free. Or should we just leave the deeds in both our names and choose to be jointly assessed.

The details are that the mortgage left on the current house is around 175000. My salary is 65000. I would expect to get 1300 rental income. My wife has no income.
 
the nett result per Revenue is the same. you should work out the same whether single or joint assessment.
 
IMO, if the income from the property exceeds the mortgage repayments (with an outstanding mortgage of 175k, interest only, at approx €650 per month?) and costs, you would probably be better off transferring the property into your wife's name.

There's some more information in a previous thread here.
 
Thanks for that. Am I right in saying that assuming the profit for the year after interest repayments is (1300-650)*12=7800, then no tax is payable if the house is in my wife's name as she has no other income and an income of 7800 would not qualify for income tax?
 
delgirl said:
IMO, if the income from the property exceeds the mortgage repayments (with an outstanding mortgage of 175k, interest only, at approx €650 per month?) and costs, you would probably be better off transferring the property into your wife's name.

There's some more information in a previous thread here.
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The advice I have received from my tax consultant is that you do not necessarily have to transferr the property into your wifes name. You simply put the rental agreement or lease in her name and the rental income and associated rental profit can then be charged at her marginal rate which would be 20%.
 
The advice I have received from my tax consultant is that you do not necessarily have to transferr the property into your wifes name. You simply put the rental agreement or lease in her name and the rental income and associated rental profit can then be charged at her marginal rate which would be 20%.
Click to expand...
Was not aware of this. How does this work if you purchase a sec 23 to shelter the tax liability in general? Does sec 23 and associated property need to be in joint names to get relief?
 
markowitzman said:
Was not aware of this. How does this work if you purchase a sec 23 to shelter the tax liability in general? Does sec 23 and associated property need to be in joint names to get relief?
Click to expand...

Sorry I wouldn't know anything about sec 23. The information I received was to do with renting a house without any special tax reliefs such as sec 23.
 
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