Thinking of selling Investment Property. What happens to "unclaimed" capital allowances?

G

Ger1966

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Hi,

I bought an apartment in Dublin a number of years ago as an investment. I've had to replace various appliances over the years - the last ones being an oven and a washing machine almost 2 years ago. I've expenses these (12.5% of cost) when doing my tax return.

I'm thinking of selling this property and am just wondering what happens to the "unclaimed" capital allowances. Between the washing machine and oven, there's still approximately €600 "unclaimed".

Can this be used to reduce the amount of Capital Gains Tax that I'd be liable for if I decide to sell? Any help / advice would be appreciated!
 
Assuming you have the property over 8 yrs, you are not currently entitled to any capital allowance deduction or claim. However I have a similar situation so I keep a record of unclaimed amounts in the hope that if a change was to take place there would be some facility to "look back" a year or two from the date of change.
 
I dont understand Westgolf's point at all.

If you are selling the oven etc with the apartment then I would presume that you can claim a balancing charge against your rental income for any unused capital allowance.
 
I am trying to work this out too. I sold my apt this year, tenancy ended in 2016 and began letting on 2011.

So, if I bought a bed for €500 in 2011, claimed a total of €312.50 over 5 tax years (2011-2015). Can I claim the balance of €187.5 in capital allowances in my 2016 tax return?
 
You can claim capital allowances on washing machines & other fixtures that you have in a rental property. The Revenue leaflet on it is here http://www.revenue.ie/en/tax-profes...ains-tax-corporation-tax/part-04/04-08-12.pdf

In relation to claiming the unused capital allowances you can do this. If you scrap the assets or dispose of the assets for zero you can claim a balancing allowance of the rest of the assets. If you don't attribute a specific value to the assets at the sale time then you can assume that the value was zero. In the year of sale the balancing allowance (for you the €600 unclaimed) can be used as an extra expense to reduce your rental income.

There is also some provision to claim a CGT loss on wasting chattels where capital allowances are claimed - there is some interaction with income tax and you'll need to check that out if you aren't claiming the balancing allowance. If you a top rate taxpayer the extra deduction for income tax will be worth more than the CGT loss in any event.
 
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