Hi
My parents have an apartment that they bought in 2006 and have been renting out. My Dad is a PAYE worker and my Mum is a housewife and they have been doing Form 12 returns for the rental income up until 2009. They didn't do a 2010 return and haven't done the 2011 return yet either so I'm trying to help them get back up to date.
Their previous returns haven't been an issue because their unused losses from a prior year have always exceeded the amount of net rental income for that year. That is also the situation for the 2010 year so we are going to do a Form 12 return for that year again.
My question really relates to this year. The net rental income for 2011 is just over €5,000 and the unused losses for the prior year is about €1,500 so there will be a total net income (minus prior losses) of around €3,500. This is the first time they will actually be paying tax on rental income so:
1. Do they need to do anything special like registering for income tax on a TR1 form or something similar such as registering on PAYE anytime?
2. Can you fill in the Form 12 online on PAYE anytime or do you need to register for ROS?
3. Since their total net income is over the €3,174 threshold of assessable non-PAYE income should I be doing a Form 11 for 2011 instead of a Form 12?
4. Will they need to make a preliminary payment and how does this work?
5. This is a bit of a hypothetical but my Mum is searching through the records to see if they have any more expenses that can be deducted so for example if the net rental income was reduced to €4,000 which would bring the total net rental income (minus prior losses) to €2,500 would this be under the €3,174 threshold? i.e is it the net rental income or the net rental income minus losses that you look at?
I've talked to three separate people in the Revenue and I haven't gotten the same answer yet so hoping someone here has also gone through this before and might be able to give some advice. I'm mainly afraid of not doing a preliminary payment if we are supposed to because I know that interest and penalties can rack up on that for non-compliance really quickly.
My parents have an apartment that they bought in 2006 and have been renting out. My Dad is a PAYE worker and my Mum is a housewife and they have been doing Form 12 returns for the rental income up until 2009. They didn't do a 2010 return and haven't done the 2011 return yet either so I'm trying to help them get back up to date.
Their previous returns haven't been an issue because their unused losses from a prior year have always exceeded the amount of net rental income for that year. That is also the situation for the 2010 year so we are going to do a Form 12 return for that year again.
My question really relates to this year. The net rental income for 2011 is just over €5,000 and the unused losses for the prior year is about €1,500 so there will be a total net income (minus prior losses) of around €3,500. This is the first time they will actually be paying tax on rental income so:
1. Do they need to do anything special like registering for income tax on a TR1 form or something similar such as registering on PAYE anytime?
2. Can you fill in the Form 12 online on PAYE anytime or do you need to register for ROS?
3. Since their total net income is over the €3,174 threshold of assessable non-PAYE income should I be doing a Form 11 for 2011 instead of a Form 12?
4. Will they need to make a preliminary payment and how does this work?
5. This is a bit of a hypothetical but my Mum is searching through the records to see if they have any more expenses that can be deducted so for example if the net rental income was reduced to €4,000 which would bring the total net rental income (minus prior losses) to €2,500 would this be under the €3,174 threshold? i.e is it the net rental income or the net rental income minus losses that you look at?
I've talked to three separate people in the Revenue and I haven't gotten the same answer yet so hoping someone here has also gone through this before and might be able to give some advice. I'm mainly afraid of not doing a preliminary payment if we are supposed to because I know that interest and penalties can rack up on that for non-compliance really quickly.