Saturday 24 August 2019

Revenue targets landlords in rental income crackdown

Charlie Weston, Personal Finance Editor

TAX officials are making door-to-door checks in estates across the country to see if landlords are paying all their taxes.

Revenue officials are focusing on estates where there is known to be a high level of rented properties in the new clampdown on landlords.

They are probing landlords who have buy-to-lets to see if they are making the correct tax claims on their rental returns and to see if they are registered with the State as landlords.

It is part of an overall investigation by Revenue Commissioner officials into the black economy, the Irish Independent understands.

There are fears that many buy-to-let landlords do not register with the Private Residential Tenancies Board (PRTB), accept cash in rent and do not make tax returns.

It recently emerged that the State paid more than €250m last year to thousands of unregistered landlords.

Half of the landlords who get rent supplement payments -- which can be as high as €1,100 a month -- from the Department of Social Protection do not have their properties registered with PRTB, despite being legally obliged to do so.

Tax officials are also checking that the money used to buy the rental property has had the tax paid on it.


Cross-checks are being made by looking at claims for rent relief from tenants, PRTB registrations, information on rent subsidies from the Health Service Authority and the Department of Social Protection.

Officials are also using data from local authorities on who has paid the second-homes tax.

Anyone who is found to have tax issues is then audited by the Revenue officials, a spokesman said.

"As part of its 2011 shadow-economy project, Revenue is additionally undertaking door-to-door checks of estates where there is a known high proportion of rented properties.

"Information obtained will be assessed in conjunction with other data at Revenue's disposal," the spokesman added.

Also part of the checks being done by tax officials is a probe of the 75pc mortgage interest restriction for residential landlords.

This was introduced in the 2009 emergency Budget.

Previously, landlords had been able to claim 100pc relief on the mortgage interest they paid on the loans for their properties.

The Revenue is determined to improve tax compliance as returns for the Exchequer have plunged. Income tax, the largest source of revenue, is now way off boom-year highs.

Earlier this year it emerged that Revenue officials were making unannounced visits to pharmacies, dentists, schools and charities in a fresh clampdown on potential tax evasion involving employees not properly registered for tax.

The Revenue is doing audits to establish whether all the people working there are categorised correctly for tax purposes.

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