Is the NPPR and household Charge deductible

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suicra05

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I was wondering is the NPPR charge and household charge, allowable expenses on a rented property from the Revenue viewpoint?
 
Heres my shot at goal...we know that some do and most dont include it, we know that the Institute of Taxation say, Revenus issued a briefing on it (I think) but;
Has anyone that included it as a deductable expense, and was subsequently audited (for general compliance), told by Revenue that it was not deductable, and had to pay outstanding taxes/interest/penalties arrising?
 
Luternau said:
Heres my shot at goal...we know that some do and most dont include it, we know that the Institute of Taxation say, Revenus issued a briefing on it (I think)
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They didn't AFAIK, so that's not helping much.

Luternau said:
Has anyone that included it as a deductable expense, and was subsequently audited (for general compliance), told by Revenue that it was not deductable, and had to pay outstanding taxes/interest/penalties arrising?
Click to expand...

Firstly, the auditor has to actually notice the claim and recognise it's not allowed - this could quite easily not happen, because their focus if they're doing an audit in the first place is certainly not going to be on whether a couple of hundred deduction has been claimed for NPPR/HC.

Secondly, if they do pick up on it, and since Revenue haven't sufficiently clarified whether it's deductible or not , a taxpayer could probably argue that it's a technical adjustment, so that's the penalty out the window, unless somehow the Inspector can prove that the taxpayer had been aware of the Revenue position (e.g. had asked and been told) and ignored it.

As regards the tax liability and interest arising - if a deduction for NPPR was the only issue arising in an audit, I'd be very surprised if the auditor sought to collect it. The administrative costs of raising the assessment(s) and collecting the couple of hundred euro (at most - remember in plenty of cases you'd simply be reducing a loss carried forward), would probably not justify it. I'd expect they'd simply agree that the taxpayer would not claim the charge going forward.
 
Haven't you guys who advise clients on tax affairs -or your official body/bodies whatever they are - not spoken to Revenue yet and got an official yes or not as to whether such-and such is tax allowable?
 
I am in no difficulty with it, it's clear enough to me what the Revenue position is, and that's the one that's relevant for me in my day-to-day.
 
As far as I'm concerned the Revenue have stated that it does not qualify as a deductible expense.

Therefore it is not included in the list of deductible expenses.
 
What is "private correspondence"?
Are these letters from the Revenue stating that LPT is NOT a deductible expence.?

If so that is quite dramatic news and surelya precursor to an official announcement.
Or did I misunderstand Joe90/TMcG posts?


I fear that Revenue may be adopting the same interpretation of what is deductible as they did with NPPR. Because the relevant act allows for the deduction of rates levied by local authorities Revenue claimed that NPPR was not allowable as it was not levied by local authorities but by central govnt.

Revenue are probably making the same claim about the LPT and are disregarding the fact that local authorities can periodically adjust it by a small margin . That is, such adjustments by local authorities do not mean that they are actually"levying" this tax.

Every LL I know believes this LPT deductible ("Mr Noonan said it would be ").

Are they in for a shock ?
 
oldnick said:
What is "private correspondence"?
Are these letters from the Revenue stating that LPT is NOT a deductible expence.?

If so that is quite dramatic news and surelya precursor to an official announcement.
Or did I misunderstand Joe90/TMcG posts?


I fear that Revenue may be adopting the same interpretation of what is deductible as they did with NPPR. Because the relevant act allows for the deduction of rates levied by local authorities Revenue claimed that NPPR was not allowable as it was not levied by local authorities but by central govnt.

Revenue are probably making the same claim about the LPT and are disregarding the fact that local authorities can periodically adjust it by a small margin . That is, such adjustments by local authorities do not mean that they are actually"levying" this tax.

Every LL I know believes this LPT deductible ("Mr Noonan said it would be ").

Are they in for a shock ?
Click to expand...

[broken link removed]

255. Deputy Noel Grealish asked the Minister for Finance when he proposes to provide for Local Property Tax to be deductible from rental income; if he will clarify his statement that it will be introduced on a phased basis; if primary legislation or Ministerial Order is required, and if it is the former, the legislative vehicle that he will use; if he will also consider extending the expense status for the 2013 tax year only of the other local service charges for the remainder of their existence; and if he will make a statement on the matter. [4171/13]

Minister for Finance (Deputy Michael Noonan): The Thornhill Group, the inter-departmental group, chaired by Dr Don Thornhill, established to consider the structures and modalities of a property tax, recommended that owners and not occupiers be the liable persons for the local property tax. This was also the view of the 2009 Commission on Taxation. The Thornhill Group recommended that the Local Property Tax paid in respect of a rented property should be deductible for income tax or corporation tax purposes, in a similar manner to commercial rates. This is not provided for in the Finance (Local Property Tax) Act 2012; it is the intention of the Government to introduce such a provision on a phased basis but the manner in which this will happen has not been decided. Such change would be provided for by primary legislation.
I am advised by the Revenue Commissioners that the Household Charge and the Non-Principal Private Residence (NPPR) Charge are not allowable deductions from rental income for tax purposes. There will be no Household Charge in 2013 and there are no plans to change this position in respect of the NPPR charge for the 2013 tax year.
 
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