Rental Losses & Tax

B

Brian_M

Registered User
Messages
16
Dear All,

I have 3 rental properties in the west of Ireland. First purchased in 2003, second in 2004 and the third in 2006. I have prepared rent accounts for each property each year but having set off interest, allowable expenses and capital allowances I have returned a loss for each one each year. The situation is not troubling for me as I am more interested in capital appreciation in the long run. I was wondering if anyone had experience of this matter as regards Revenue and taxation.
I know that Revenue disallow uneconomic rentals but to date they have raised no issues on the returns. I am charging market rent via a management company and claiming due allowances. I was wondering if there is a limit that they allow accumulated losses to reach.
Any experiences welcome.
 
What are the "capital allowances" you refer to if there is no tax incentive?

I'm only familiar with section 23 where the capital allowances can be taken in the first year which amounted to a loss of over 300k being caried forward at one stage.

I'm not aware of any limits on what you can carry forward but you can only set them off against rental income not capital appreciation or any other type of income.
 
I believe by uneconomic rents they mean things like renting say a property to a relative for 5 Euro a month so that you would have a loss overall on all your rental properties. If you are charging a normal market rent you shouldn't have any problems. There is no limit to losses that I've ever come across.
 
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