Renting out old & renting another new house

[The Grinder]

I own my current house and have paid off the mortgage. I am thinking of renting it out and should get €10k p/a rent. I am then looking to rent and move into a different house where the rent will be €16800 p/a. I understand that I will get tax credit relief which will knock €800 (married) of this figure so I'm now down by €16k p/a. I am a top tax earner. Will the €10k p/a be subjected to tax (41% + 6.5% prsi) of 47.5% leaving just €5250 gain from the house I own. This means the move cost p/a will be €16k - €5250 = €10750. Is this correct or can you give advise on how this will work out. Thanks

 

[ClubMan]

I own my current house and have paid off the mortgage. I am thinking of renting it out and should get €10k p/a rent.

You need to look at the Property Investment forum, FAQ, key posts and numerous posts on this issue (converting a PPR into an investment/rental property) to get an idea of the tax and other implications.

Will the €10k p/a be subjected to tax

The rental income will be assessable for tax. The details are summarised in the Property Investment forum as mentioned above.

What is your motivation/rationale for renting out your PPR and renting accommodation elsewhere for yourself?