Landlord incentives

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Brendan Burgess

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86% own just one or two properties

Temporary tax relief for small

€3,000
€4,000 2025
€5,000 for 2026 and 2027

Will be disregarded for standard rate tax
 
How does this work in practice say for somebody receiving rent of 10k even. Is the tax paid on 7k in 2024 and 6k in 2025 and 5k in 2026/2027 ?
 
Laughahalla said:
How does this work in practice say for somebody receiving rent of 10k even. Is the tax paid on 7k in 2024 and 6k in 2025 and 5k in 2026/2027 ?
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I assume its the first 3k is at 20% + prsi + usc and the remaining 7k as it is now marginal + prsi + usc and so on for the remaining years.

The devil will be in the detail I assume when the document is published after the speeches.
 

​


Landlords​

Ceann Comhairle, I have already announced an increase in the rent tax credit for 2024. For every tenant, there has to be a landlord. In recent years, we have seen a decline in the number of small investors in the market owning one or two properties. 86% of landlords in the market own just 1 or 2 properties and they have a vital role to play.
With that in mind, I am introducing a temporary tax relief which will primarily benefit small landlords. Subject to certain conditions being met, rental income of €3,000 for the year 2024, €4,000 for 2025 and €5,000 for the years 2026 and 2027, will be disregarded at the standard rate. An important condition of this measure is that the properties held by the landlord availing of the relief must remain in the rental market for four years, otherwise the full amount of the relief will be clawed back. Further details are contained in the Budget documentation.
 

The relief will be €3,000 for 2024, €4,000 for 2025 and €5,000 for 2026 and 2027,
which is equivalent to a tax credit for landlords of up to €600, €800 and €1,000 respectively. Scheme to end in
2027. Further conditions apply.
 
So if a landlord was 60 and retired assuming all his income was in the lower tax bracket (below 42k) would he see any benefit?. Is this just for landlords who's rent is in the higher bracket?. Or am I misreading something?.
 
Ridiculous amount of deadweight loss with this kind of measure.
 
Once again they promise to help, but again and again fail to really incentivise landlords to stay.
If they were serious, the least that they could do to encourage people to stay would be to backdate it include returns made for 2023. To think that this measure will only help in 2025, when a landlord is submitting their tax return, it’s useless to entice current landlord to stay.
 
Bill90. said:
So if a landlord was 60 and retired assuming all his income was in the lower tax bracket (below 42k) would he see any benefit?. Is this just for landlords who's rent is in the higher bracket?. Or am I misreading something?.
Click to expand...

Yeah pretty much no benefit if you are in lower tax bracket as all your income would be subject to standard rate plus USC and prsi. The relief assumes most/all landlords pay higher rates of tax (which is obviously not case in all instances)

Back of fag packet calc is below (USC and PRSI excluded for simplicity). Open to correction also on any point.

Current
2024​
2025​
2026​
2027​
Rent15,00015,00015,00015,00015,000
Less expenses5,0005,0005,0005,0005,000
Taxable10,00010,00010,00010,00010,000
Standard Rate 20%600
800​
1000​
1000​
Marginal 40%4,0002,800
2400​
2000​
2000​
Total Tax4,0003,400
3200​
3000​
3000​
Net profit6,0006,6006,8007,0007,000
 
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Current Gov will be lambasted on this from every side

Opposition will accuse them of being LL friendly
LL's will argue not far enough

I am out Tenenat is gone this week after 9 months or notice and a month of me allowing overhold.
Personally this has not changed my mind.
 

It appears (to me anyway) the strategy was to push landlords into a slightly positive cashflow position (or indeed close to breakeven) but if they were looking to attract new investment into the sector they haven't a hope.

I found it interesting in the first few sentences of Sinn Fein's response post budget they mentioned "this budget is for landlords" laughable stuff really.
 
In March, it was announced that measures would be retrospective for 2023. But apparently not.
 
I’ve two properties rented, one to a HAP tenant, both leases have expired. Both in RPZ paying well under market rate.

I was waiting on the budget to see if it was worth my while hanging onto them.

Tenants will be served with notice by Friday and they’ll be put up for sale within 6 months.
 
imalwayshappy said:
but if they were looking to attract new investment into the sector they haven't a hope.
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Exactly.

There are tens of billions rotting in deposit accounts in Ireland.

A CGT exemption for anyone who buys and keeps the property tenanted for ten years (like in Germany) would have had zero upfront cost and attracted lots of fresh money in.
 
While tax relief would have been hoped for - an obvious one to encourage landlords to stay in the market would have been CGT exemptions for a duration of time in the market.
All they've done with this is allow SF to spout and grab soundbites with it being a "landlords" budget (does no one challenge this rubbish?) when in truth, anyone thinking the risks of being in the market are enough to make them want out is NOT going to stay in the market for the sake of Eur600 !! - not sure why they bothered..
 

Perhaps difficult but a system where landlord with properties well below market rate get more tax relief and those renting at the top of the market get none / little.

Could look at rent / property tax value for what is high or low value.

Similarly I know people paying very low rent getting a few months worth back.
 
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