Capital allowances against rental income

H

Haille

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I purchased a 2nd property to let in 2007.I have rented out the property since then.I spent over €50,000 on refurbishment of property.At the beginning of 2017 i had still €19,315 capital allowances not used.My question is can I still off set 12.5 percent of €19,315 against my rental income each year or is there a time limit?
 
No there is no time limit but there are a couple of things here

1. Are you sure you are calculating the Capital Allowances properly? In each of the 8 years from 2007-2014 you should have included Capital Allowances of €6,250 in your tax return. Any unused Cap Alls are c/fwd to the following year etc so after the 8 years any amount of the €50K not used can be used to reduce the rental profit, down to zero if that is the case. There is no need to use any 12.5% calculation at this stage. It's just a lump sum loss being c/fwd every year until it's used up

2. There is however a question mark as to whether the €50K refurbishment qualified as Capital Allowances at all. It depends on the type of work done but with a figure that substantial I would guess that it should have been classified as Improvements to Premises and would therefore only be relevant in a tax return if and when you eventually sell the property and have to do a CGT computation/return
 
Was the work done prior to the first tenancy? Sounds like it was. And therefore is only eligible against CGT when you sell the property.
 
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