Stamp duty and rental income tax

[gauchagirl]

Hi all,

I really need some good advice.

I bought an apartment in 2005 for 250,000 Euros. As I wasn't earning enough at the time my mother had to take a 50% share in the place.

However, I went off traveling in 2006 just for three months. I ended up getting a job in Australia and stayed for four years. I didn't pay stamp duty as a first time buyer on a new property. I thought I would be back to Ireland in no more then two years and would go back to living in my place but then everything went pear shaped in Ireland.

In 2010 I lost my job in Australia and my visa as result. That was in November of last year. I haven't had full time employment since. My husband is Brazilian so we decided to move there with there being no jobs in Ireland. In Brazil I only earn about 600 Euros a month.

My apartment in Dublin is rented out for 850 a month but the outgoings are 1,300. My mother and I share these costs. We can't sell the place as it's in too much negative equity. Now that I won't be able to get the capital down for at least another 10-15 years I want to sort everything out. However, I am really skint and there is no way I can afford the stamp duty nor can my mum.

I know my situation is serious so I need some sound advice.

- Is there any way around the stamp duty issue? For example if I declare rent from now will they check back over the last few years?

- As I don't live in Ireland but my mum does do we declare it as a non resident landlord or resident?

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[gauchagirl]

Anyone even know of a good tax adviser or accountant? As it was bad advice that got me into the mess in the first place.

 

[M K Brazil]

Stamp duty is not my field but I think you might be OK provided you didn't rent it out for the first 2 years. I know the rule was the first 5 years but I think that they reduced it to 2 years provided the first rental was after 2007.

Going forward - make sure that your PRTB registration is in order, and that you declare the rental income to the Revenue each year. If the rent is < the allowable costs then you'll have no tax but must still do a Return. allowable costs include 75% of the loan interest, insurance, letting agents fees, management fees, etc etc. Based on your email, it would appear that the rent is < allowable costs so you should have no tax bill for a while - provided you keep your PRTB registration in order.

If the property is really jointly owned, then both you and your mother must do a Return - but double-check that your mother is on the deeds and not just a loan-guarantor etc.

Bottom line is - don't worry. There is some forms to be sorted but probably no real costs if you are lucky.

Hope this helps.