Hi,
I became domiciled and tax resident in Ireland as of 2019, I have a rental property in the UK with a mortgage which I rent out on a full time basis. I am trying to work out my tax liability in Ireland, there is an example here on [broken link removed] for foreign rental income. The example is based on a higher rate tax payer as follows
- ( Irish Income + Foreign Income ) * 40% = Total Tax Due
- Foreign Income / Total Income = % of Foreign Income
- % Of Foreign income * Total Tax Due = Tax due on foreign rental income
- (90k + 10k) *0.4 = 40k
- 10k / 100k = 10%
- 10% * 40K = 4k = Tax due on foreign income
This seems a bit too simple as I thought I would also have to pay PRSI / USC on it similar to a resident landlord and it also taxes entire income at 40%. Has anybody direct experience of this?
My second question is that an allowable expense is for Property Management, currently my father does this for free but if I were to start paying him a monthly fee, as long as he declares the income on his tax returns it is fine or do I have to pay a registered firm?
I became domiciled and tax resident in Ireland as of 2019, I have a rental property in the UK with a mortgage which I rent out on a full time basis. I am trying to work out my tax liability in Ireland, there is an example here on [broken link removed] for foreign rental income. The example is based on a higher rate tax payer as follows
- ( Irish Income + Foreign Income ) * 40% = Total Tax Due
- Foreign Income / Total Income = % of Foreign Income
- % Of Foreign income * Total Tax Due = Tax due on foreign rental income
- (90k + 10k) *0.4 = 40k
- 10k / 100k = 10%
- 10% * 40K = 4k = Tax due on foreign income
This seems a bit too simple as I thought I would also have to pay PRSI / USC on it similar to a resident landlord and it also taxes entire income at 40%. Has anybody direct experience of this?
My second question is that an allowable expense is for Property Management, currently my father does this for free but if I were to start paying him a monthly fee, as long as he declares the income on his tax returns it is fine or do I have to pay a registered firm?