Revenue say I owe them €17k for TRS

N

Needabreak

Registered User
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2
Hi,

I bought an apartment in 2006 and shortly after realised I couldn't live in it because commute to work was a disaster so I moved back home with my folks and rented the place out.

Then in late 2008 bought a house with my husband and kept the apartment.

I knew I was getting TRS on apartment mortgage but didn't realise I didn't qualify anymore once I rented it out.

We got my husbands half of TRS on house mortgage which seemed right to me.

Got a revenue invoice yesterday looking for €17k for repayment of TRS I was given on apartment mortgage.

I'm absolutely in bits trying to figure out how I will repay it or what to do.

I suppose my question is if I wasn't entitled to TRS on apartment, should I have been getting it on the house mortgage? I thought TRS was related to first time buyer.

I'm so clueless and I'm praying theres a way out of this.

Would really appreciate any insights anyone has.

Thank you
 
You get TRS on your PPR. So you may be entitled to some on your house.

What were you claiming as an interest deduction? 75% of the interest or 75% of the interest after TRS?
 
Like I said, I'm clueless. And embarrassed.

I have paid no tax on the rental income and filed no returns.I have buried my head in the sand on this.I have also been making huge losses year on year in terms of rental income v mortgage repayments .

House mortgage was 400k and we got €133 trs so.I'm really hoping that if I could have claimed trs on my part of house they might offset that against the trs I got for apt.

Any idea if this might be possible?

Thank you
 

Depending on the figures it may not be as bad as you think.

You absolutely need a good accountant to do your tax returns. Joe 90 is one.

You'll have to register with the Prtb, apparently it is possible nowadays even after tenants have left. This is to claim mortgage interest relief. Which would be .100% in 2006.

However I have very bad news in relation to NPPR, that's 7 k off the top of my head for one property.

DO NOT REPLY TO REVENUE WITHOUT TALKNG TO AN ACCOUNTANT.

Can you give a rough idea for each year of rent, mortgage interest, costs.
 
Bronte has given great advice there - I imagine now that revenue are aware that you have been renting out the apartment, it is only a matter of time before the issue of you not filing income taxes comes to your doorstep as well.

It would be well worth the accountant's fees in this instance, and better to be honest about everything to them so they can give you the best advice.
 
Needabreak said:
I have paid no tax on the rental income and filed no returns.I have buried my head in the sand on this.I have also been making huge losses year on year in terms of rental income v mortgage repayments .
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No you have negative cash flows not necessarily huge losses.

Rental profit is the rental income less 75% of the interest (Not Mortgage Repayments) and other expenses.

You will get something for the TRS on your PPR but you need address the rental income tax too.

Did you live in it for 2 years http://www.citizensinformation.ie/en/housing/owning_a_home/buying_a_home/stamp_duty.html
 
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Sorry to hijack this thread but Im in a similar situation myself and very scared. No rental returns done and property rented out since 2012.(Ngative equity and costing alot every month etc)
Revenue have not contacted me in relation to this. Not registerd with PRTB as a friend living there and arrangement suited both of us at the time. Low rent etc.. Would filing a tax return for 1 year only in Oct completely be a bad idea? Would revenue immediately write to me for previous years? I have no idea where Im going to afford all the tax liabilities and very stressed but at the same time want to become tax compliant but have no savings to start repaying.
 
Sparkle said:
I have no idea where Im going to afford all the tax liabilities and very stressed but at the same time want to become tax compliant but have no savings to start repaying.
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Surely the way to relieve the stress is to deal with the issue.

write down the rental income.

Get out your mortgage statements/interest certs, summarise your rental expenses, see where you stand.

Did you cancel the TRS?
 
Has anyone successfully sorted a mess out like this? Id appreciate a PM. Ive two small kids and feeling sick to my stomach every morning I get up.
 
Sparkle said:
Has anyone successfully sorted a mess out like this? Id appreciate a PM. Ive two small kids and feeling sick to my stomach every morning I get up.
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There are other posters on here who have dealt with this. I suggest like the other poster did that you sort it out or the feeling will only get worse and totally consume you. Why don't you start with posting the figures, it will give a rough idea of your real liability if any.

There are also procedures to dealing with revenue to limit penalties and also to arrange a payment plan if necessary. An accountant is money well spent on this and us tax deductible.
 
Cervelo said:
Anybody else want to admit to tax evasion
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This is one of those things that revenue don't even have to really search for, they just have to wait. But it's exceedingly painful when they catch you, but people can do things to mitigate that.
 

Needabreak,

Having been in a similar situation re issues with the Revenue, the best thing for you to do is to tackle it head on and get an accountant as others have advised. Well worth it in my experience.

I can give you the name of the guy i used. He was very good and gave excellent advice. Really put my mind at ease.

NM
 
Bronte said:
This is one of those things that revenue don't even have to really search for, they just have to wait. But it's exceedingly painful when they catch you, but people can do things to mitigate that.
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That's it Bronte, the longer they wait the bigger the return for the Revenue.
 
I've a colleague who got caught by revenue for not filing returns and paying tax on rental income. He went to a tax advisor and it seems avoided any penalties, just paid interest. Thing is though he was also claiming TRS which revenue have not written to him about. Is it safe to say that now he has filed returns that he can expect a letter in the post looking for this back?
 
Joe_90 said:
Perhaps for everyone's benefit you would outline the issue and how it was resolved.
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Without going into too much detail (publicly) - I had my property rented out for a number of years without making any returns on it. The revenue requested returns for the previous 4 years and because i didn't understand the whole process i expected to get a bill of about €30k with interest and penalties. I got in touch with an accountant and they really put my mind at ease. In the end my liability turned out to be less than €3k - some of which related to a PAYE underpayment for one of the years. They didn't add any interest or penalties either.

What i didn't understand is that there are so many ways to reduce your tax liability, like offsetting certain expenses against it including the accountant's fee.

I found it wasn't as bad as i thought it would be once i got some advice. It felt good to finally take control of the situation and get it sorted.
 
Sorry i should probably add details of what i was able to offset against my tax liability - for anyone in the same situation:

- Accountant's fees for preparing the returns
- Mortgage interest (75% I think) (the tenancies had to first be registered with the PRTB to avail of this)
- Furniture depreciation (i'm not sure of what the percentage is but this is claimed every year)
- Expenses relating to any repairs carried out in the property or replacement/repair of any of the contents
- I was also able to obtain receipts for furniture and electrical items bought when i first purchased the property and this was offset against it also - DID Electrical and Harvey Norman held the receipts electronically so i was able to obtain copies from them
- There was a loss for 2 of the years and this amount was allowed to be carried over to the following year. I don't fully understand exactly how this works but perhaps somebody else could elaborate on this.
 
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