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Mortgage Interest Relief

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  • Mortgage Interest Relief

    I have just rented out my property. I have registered with PRTB as well. I have not purchased another property (I'm going to rent in another city). I owned the house for over 2 years before renting it out completely. Questions i have are :1) am I still entitled to mortgage interest relief? 2) i am liable for capital gains tax 3) am I liable for stamp duty (I bought the house as a 1st time buyer.

    All help appreciated. Thanks.
    Last edited by LV001; 21-05-2008, 04:25 PM.

  • #2
    Read this thread,should answer a few of your questions.

    http://www.irishlandlord.com/forum/showthread.php?t=10

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    • #3
      As far as I understand it once you rent the property you become liabe for all the taxes associated with rental property, technicially you would no longer be entitled to mortgage interest relief but the mortgage interest would be an alllowable expense for tax purposed against your rental income.

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      • #4
        Thanks folks. I read the other post as well. I will inform revenue of my changed circumstances.

        As a 1st time buyer a couple of years ago and not having paid any stamp duty, I assume, having rented the property now, I do not need to pay any stamp duty?

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        • #5
          You assumed wrongly stamp duty will be payable on the purchase price as your did not use it as your residence for the following two years from 31st December 2007. Previously it was five years and there ae transitional arrangements.
          However if you take advantage of the rent a room allowance which is 10,000 per annum it might be adviseable to take a rent of 10,000 per annum and keep part of the house as your PPR ie Principal Private Resaidence but your nmortgage relief will be limited to the normal allowance at standard rate and no allowance will be given for your new abode ie Rent allowance or residential mortgage interest relief
          When the five years or the transitional period is iover you can then rent at the market rent and claim the mortgage interest paid of the now rented house in full as a business expense and pay tax at the marginal rate of your total income
          Full details of the date of purchase, price mortgage etc would be required to give a more definitive reply
          This is not a professional opinion

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