Rental Income Accounts

Can anybody help me with this question. I am about to do my rental income accounts for 2010 before I fill in Form 11. The house was on let in November so the amount of rental income for 2010 is 550. What figure can I use for the interest on mortage as this is a yearly figure? I know I can only claim 75% of interest but do I have to break the figure down to get a monthly figure? Also am I correct in saying I cannot claim for any expenses before house was let - even though all these expenses were for in order to let it?

As for wear and tear on furniture etc - do I just estimate the cost of this? As I have no idea how much everything in house was?!

Have a read of the following threads:

http://www.askaboutmoney.com/showthread.php?t=159847
http://www.askaboutmoney.com/showthread.php?t=159235

Also, you need to be aware that you are only entitled to claim 75% of mortgage interest as a deduction if the tenancy is registered with the PRTB... (cost of registration is also allowed as a deduction).

You may also need to check that you aren't claiming TRS (tax relief at source) on the mortgage if it was bought as your sole / main residence...

There's lots of threads about all of this stuff in the Property Investment and Tenants' Rights forum...

mur42 said:

Also am I correct in saying I cannot claim for any expenses before house was let - even though all these expenses were for in order to let it?

Click to expand...

From IT70

Expenses incurred prior to the date on which the premises was first let are not allowed apart from auctioneer's letting fees, advertising fees and legal expenses incurred on first lettings.

DB74 said:

From IT70

Expenses incurred prior to the date on which the premises was first let are not allowed apart from auctioneer's letting fees, advertising fees and legal expenses incurred on first lettings.

Click to expand...

You are incorrect in that.I have claimed pre letting expenses,furniture white goods etc prior to first letting and have been allowed claim them as expenses,If a chartered accountant tells me this is allowed,who am I to argue.

With reference to Revenue I think they mean you cannot claim the interest relief on a property recently purchased but not yet let.

Knuttell said:

You are incorrect in that.I have claimed pre letting expenses,furniture white goods etc prior to first letting and have been allowed claim them as expenses,If a chartered accountant tells me this is allowed,who am I to argue.

With reference to Revenue I think they mean you cannot claim the interest relief on a property recently purchased but not yet let.

Click to expand...

Pre-letting expenses refers to current expenditure, such as ESB, rates, refuse collection or general maintenance / upkeep prior to letting.

The types of expenditure you've mentioned above are not expenses, they are capital items which qualify for a wear & tear allowance over several years (or perhaps not, depending on who you run into... http://www.askaboutmoney.com/showthread.php?t=159847)

mandelbrot said:

Pre-letting expenses refers to current expenditure, such as ESB, rates, refuse collection or general maintenance / upkeep prior to letting.

The types of expenditure you've mentioned above are not expenses, they are capital items which qualify for a wear & tear allowance over several years (or perhaps not, depending on who you run into... http://www.askaboutmoney.com/showthread.php?t=159847)

Click to expand...

Nicely put.

mandelbrot said:

The types of expenditure you've mentioned above are not expenses, they are capital items which qualify for a wear & tear allowance

Click to expand...

I'm glad you've cleared that up as I was beginning to worry myself. You probably should put that reply on the other thread so that others don't think wear and tear is not allowed.

Bronte said:

I'm glad you've cleared that up as I was beginning to worry myself. You probably should put that reply on the other thread so that others don't think wear and tear is not allowed.

Click to expand...

That very question is one that causes huge confusion,I remember a few years ago trying to find a definitive answer to it myself and at every turn I was quoted

Expenses incurred prior to the date on which the premises was first let are not allowed apart from auctioneer's letting fees, advertising fees and legal expenses incurred on first lettings.

Click to expand...

I wonder how many people who do their own returns never included capital purchase to be written off over 8 years purely based on that sentence,indeed Revenue are not much better informed.
It really does need to be clarified on the Revenue website/leaflets

The leaflet does also say

"If a premises is let for residential purposes and it is furnished, a claim can be made for a wear and tear allowance based on the cost of the furniture and fittings. It will be necessary to retain an itemised list of expenditure incurred each year. With effect from 4 December 2002 the allowance is 12.5% per year over 8 years."

I can see where it could be confusing for a non-accountant doing their own return though.