Tax Return questions!

D

dillons

Registered User
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Looking for some information on tax return for rented property, know I should ring revenue but thought I'd check in here first!
Thanks in advance!

I started late last year and did a short term lease for just 2 months, I wasn't up to speed and didn't register this with PRTB, those tenants have gone now so is it true I can't now register that lease with PRTB? so I can't claim mortgage interest relief for 2011 against rental income? Is it worth a phone call to PRTB?

As it's only 2 months of the year, how do I work out the reductions in income, eg do I pro-rate the annual management company charge to 2 months worth or deduct full amount? same applies to mortgage protection policy, house insurance etc?

In relation to 2012 rental income, is this due Oct 2013 or do I have to pay preliminary in Oct 2012? I'm regular PAYE

I have to replace the washing machine, I thought I would be deducting the full amount of replacement machine from the rental income for return and remove washing machine from my fixtures and fittings list for future depreciation? Is this correct?
or
Do I deduct the value of the old machine and then add the replacement cost to the fixtures & fittings list to be written down over the next 8 years? I only just heard about this and now I don't know which one is correct!

I phoned revenue about what I should include in fixtures & fittings and couldn't get a proper answer from them, does anyone have an approved list? Can I include the likes of fitted kitchen, fireplace, flooring etc?

I'm hoping to avoid the added expense of accountant for this

Cheers
 
Hi dillons

I'm not sure about the query in relation to registering a tenancy late with the PRTB - maybe someone else can help with that.

In relation to the management charge etc - yes these must all be pro-rated to 1/6 of the total annual cost.

In relation to 2012 income - preliminary tax should be paid in Oct 2012

The new washing machine should be deducted as a capital expense - so 12.5% of the cost over the next 8 years. The old washing machine can probably be written off (so for e.g. initial cost, less 12.5% for each year you used it to get value for start of tenancy - at least this is the way I calculated for existing fixtures/fittings, maybe someone will correct me).

I have found the following sites very useful for information:
http://www.domybooks.ie/2011/05/allowable-expenses-against-rental-income/
[broken link removed]

http://www.let.ie/articles/a-revenue-guide-to-rental-income

I think that it's also a good idea to have an accountant look at any figures you come up with - don't forget that it's a deductible expense and could save you money in the long run.
 
Thanks Nutso, I wasn't really thinking about the accountant being a deductible expense. It does make sense.
Cheers
 
I have heard of Landlords successfully registering long departed tenants with the PRTB,speaks volumes about the competency of that particular quango.

If you are quick on the uptake and do your research there should be no need for an accountant for one property.

As for the washing machine,write it off in one go, that's what my accountant does even though technically you are supposed to write it off over 8 years as nutso correctly pointed out.

You really need to know the ins and outs of the Landlording Business,you can be sure tenants that you deal with will know their rights inside out,failure to take it seriously will see you roasted badly in the not so distant future.

Heres a good starting point.

http://www.irishlandlord.com/forum/
 
Thanks for your reply. I must admint it would be much easier to write the likes of washing machine purchase off in one go.

But if I do write it off over the next 8 years then how do I account for the remaining unwritten off portion of the old machine if you know what I mean?!

For example. If there is a cooker in the house being written off 50 a year over 8 years and 2 years in it needs to be replaced. Only 100 will have been written off so there's a remaining 300, is this written off that year and the price of the replacement machine then starts off being written off over the following 8 years?

I think I will try the PRTB for the 2011 lease so but in reality only 2 months rent won't cause a huge problem if I can't write off the mortgage interest.

Thanks again
 
dillons said:
is this written off that year and the price of the replacement machine then starts off being written off over the following 8 years?
Click to expand...


Yes --- but if new washing machine is only a couple of hundred euro i'd take ita s an expense this year 300+ the new washing machine or 300 + 1/8 of the new washing machine
 
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