Houses * 2 - I need advice !

[Laura]

I bought a property in my home village in July 2001 I got the first time buyers grant plus as it was a new house was exempt from stamp duty. The property cost c 176K in July 2001. As I was working in Dublin I rented in Dublin and viewed the property as my PPR. I rented out the property to cover the mortgage repayment. During this while I never got around to reviewing this situation from a tax liability point of view

The plot thickens - I have now gone joint on a mortgage with my husband on a property in Dublin where I now live. The property is registered in his name and we bought the house April 2005. Ultimately I want to live in the property in my home village and for that reason I would prefer not to sell it.

I am anxious now to tidy up my tax affairs and I'm trying to figure out the best way to minimise my tax liability. I have found it difficult to find a good tax advisor to help me organise this mess so would appreciate any feedback on this front. I am a PAYE worker.

My questions are as follows :

(1) If I chose to declare my dublin property as my PPR and then declare my village property as an investment property would there be stamp duty clawback and what other monies could I end up owing.

(2) Can any one advise me on the possible different scenarios and the best one to minimise my tax liability ?

(3) Could anyone recommend someone where I could go and discuss this with.

I really want to tidy this mess up so any help would be appreciated.

Laura

 

[quickquestio]

As I was working in Dublin I rented in Dublin and viewed the property as my PPR. I rented out the property to cover the mortgage repayment.

You will have to pay stamp duty and repay the first time buyers grant.
once you rented out your property it stopped being your PPR and
became an investment.

Did you pay tax on the rent?
Did you continue to claim mortgage interest relief?

see this
http://www.askaboutmoney.com/showthread.php?t=14061&page=1&pp=20

 

[RainyDay]

Hi Laura - Good to see you taking steps to regularise your situation. Note that you don't have a choice over which house to 'declare' as your PPR. Your PPR is where you live. A husband & wife can have only one PPR between them.

 

[Laura]

I have not paid tax on the rent received on the property. My mortgage on the property is getting mortgage interest relief. However the joint mortgage on the property bought in Dublin is not getting tax relief.

(1) How much stamp duty is repayable ? How is that calculated ?

I know how much the ftb is so I know what my bill is there...

With having purchased in Dublin recently I do not have thousands of euros hanging about to payback a clawback so what are the options there for me in that situation ? I know that obvious solution is to sell the village property but ideally I would like to hold on to as I hope to move out of Dublin in a few years.