My mother died in January, RIP. We had rented out the family home to cover the costs of her nursing home care. We availed of the Fair Deal and declared this additional income to the HSE at the time.
Hi garbanzo,
Sorry for your loss, I can’t answer your questions re tax liability, hopefully others can, but could I please ask you a related question which would benefit others in similar circumstances to your own.
How does renting the family home cover nursing home costs ?
My understanding of Fair Deal is you pay 80% of all income including rental income towards the cost of your care. I also understood that reasonable expenses associated with renting were not allowed for Fair Deal purposes, unfair in my opinion, but that appears to be the way it is.
For arguments sake if you got €1000 a month in rental income you were assessed on that entire amount without any allowances, so €800 would go towards the cost of nursing home care, the €200 that’s left would more than likely be used up with letting expenses, such as wear & tear, agents, PRTB etc, also bear in mind that a vacant house is exempt from property tax if the owner is in full time nursing home care, if there are tenants, property tax still applies.
I know several, family members included who are in nursing homes under Fair Deal and have vacant homes for the above reasons, there would be no financial gain, it would probably even cost them. Add to that the hassle of another family member / friend having to take on the stressful role of landlord.
Also once assessed you are liable for that amount for the next year, you can’t apply to be reassessed for another year, one might have vacant periods between lettings, or the tenant who doesn’t pay, or refuses to leave ?
It seems to me that renting the family home, at best would be a lot of stressful work for a reluctant landlord, with numerous potential problems, there would be no financial gain, one would probably even be worse off, and potentially could be a lot worse off, why would anyone go there ?
What am I missing ?
Thanks.