Owner occupiers who rent out a 2nd property

R

RMCF

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Not sure if this is the correct forum (mods please move if not), but I was wondering if anyone out there owns and lives in a house, and rents out a 2nd property?

If so, what is the tax rate on the received rental income?

Thanks.
 
Yes, we do and the rent must be declared as income. For us it means paying 41% tax on it.
 
Thanks for the reply.

41% !!!!

Are there different rates? Or is this a fairly standard figure?
 
RMCF said:
Thanks for the reply.

41% !!!!

Are there different rates? Or is this a fairly standard figure?
Click to expand...

Rent is considered income so is taxed at income tax rates.

If you currently pay tax at 41%, then the rent is added on to your income and you will pay tax at 41%.

You can deduct mortgage interest payments and certain expenses.

Have a look at this key post for more information
http://www.askaboutmoney.com/showthread.php?t=9351
 
Another question in case someone might know the answer,

if I decide to rent for a year or two to try it out and decide to sell the house instead, will I incur any charges? I'm thinking of capital gains.
 
RMCF said:
Thanks for the reply.

41% !!!!

Are there different rates? Or is this a fairly standard figure?
Click to expand...

There are three rates of income tax in Ireland.

0%

20%

41%

It doesn't matter if it's rental income, dividend income, wage income, etc.
 
RMCF said:
Another question in case someone might know the answer,

if I decide to rent for a year or two to try it out and decide to sell the house instead, will I incur any charges? I'm thinking of capital gains.
Click to expand...

Well you owe the NPPR tax, but you owe that whether you rent it or not.

www.nppr.ie

Yes, if it is an investment property, and you sell it in the future, you will be subject to CGT, though you will get credit for all the time it was a PPR.
 
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