Wednesday 29 March 2017

What you can claim as landlord expenses

All landlords must be registered with the PRTB, but the registration fee can be deducted against tax, as well as an environmental audit fee
All landlords must be registered with the PRTB, but the registration fee can be deducted against tax, as well as an environmental audit fee
Independent.ie Newsdesk

Independent.ie Newsdesk

If you are a landlord - especially if you are an 'accidental' one - you might be surprised at the variety expenses you can claim back if you are not doing so already.

"We deal with landlords every year who, before they approach us, are unaware of the list of items that are tax deductible," said Barry Flanagan, tax expert at taxback.com.

The main ones are:

  •  maintenance of the property - in other words. repairs, cleaning, decorating and painting
  •  insurance of the premises
  •  management fees
  •  accounting fees
  •  advertising costs
  •  legal fees for drafting up leases, &
  •  mortgage interest (only 75pc allowable for residential properties)

You can also claim a deduction for wear and tear as a capital allowance, as well as for investment in contents like washing machines or furniture.

All landlords must be registered with the PRTB, but the registration fee can be deducted against tax, as well as an environmental audit fee.

"Capital allowances are one of the most valuable deductions which are commonly overlooked by landlords," said Flanagan. "Wear and tear allowances are available for the capital cost of fixtures and fittings (for example, furniture, kitchen appliances, etc) provided to furnish rented residential accommodation."

The rate of wear and tear allowances for capital items is 12.5pc over eight years, so if you bought a suite of furniture for €1,000, a capital allowance of €125 per year can be off-set against the rental income for tax purposes for the next eight years.

You can't claim back any expenses incurred before you started letting out a property, with the exception of auctioneer letting fees, advertising costs, and legal costs, according to Mr Flanagan.

Can landlords deduct local property tax yet? "While in future it may be possible to claim a deduction for the LPT, at the moment it is not possible," said Mr Flanagan.

He said the Government has accepted in principle that LPT be a deductible expense in calculating a landlord's taxable rental income, but it hasn't implemented it yet.

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