Tax Question on Property Investments

[ger.mcmahon]

Hi,

I currently have an investment property which is rented out (I have posted a question on this mortgage aspect of this also). I am buying a holiday home which will be let some of the time and used by myself on other times. I do not need a huge amount of money to purchase this holiday home and plan to borrow the money on the mortgage of other investment property that is let out.

My question is about tax returns and can i combine all income and costs of both properties together on working out my tax return or do i have to keep all income and costs per property seperate when working out my tax return.

cheers,

ger.

 

[doberden]

You'll have to keep them all separate.

 

[delgirl]

You might want to read Revenue's IT70 - [broken link removed]:

"What if a loss is made?
A loss will arise if total allowable expenses are more than the rents received. This loss can be set against any other profit rent made by the landlord or carried forward against future rental profits. Such losses cannot be carried back or used to shelter non-rental income."

 

[xeresod]

You work them out seperately. For Irish properties each profit/loss after allowable expenses is combined into an overall rental profit or loss, which is your total for Irish rental income on your tax return. For foreign properties, again each net figure is combined to give an overall total but is entered as foreign income on your return.

There is no need to submit each computation with the return but they must be kept along with receipts etc for deductions, in case of audit or even just verification checks that are sometimes when refunds are due.