Rent-a-Room Scheme

Where a room in a persons’ principle private residence is let as residential accommodation and the gross annual rental income is less than €10,000 per annum this rental income is exempt from tax. Where it exceeds €10,000 the rent is taxable in full.

Qualifying room rentals will not affect entitlements to claim mortgage interest relief. It will also not effect CGT relief on Principle Private Residence on the disposal of the dwelling, and will not lead to a stamp duty claw-back. The relief will not apply where the letting is between connected parties and rent relief is being claimed.

Home Carer’s Credit

A Hone Carer's tax credit of €990 is available for married couples jointly assessed, where only one spouse is working and the other cares for children, individuals over the age of 65, or incapacitated individuals in their home. No credit is available where the income of the carer exceeds €6,620. A reduced credit applies if the carer’s income is between €5,080 and €6,620 for the tax year.

Childminding Relief

Childminding relief is, available where an individual minds up to three children (excluding their own children) in their own home. No tax will be payable on the childminding earnings received, provided the amount is not more than €15,000 per annum. If the childminding income exceeds this, the total amount will be taxable as normal under self-assessment.

Tax Exemptions & Reliefs

Relief for the Long Term Unemployed

Tax incentives were introduced to benefit employees and employers. The employee is entitled to two separate allowances, as follows:

Personal Tax
Allowance           Child Tax Allowance
€                         €
Year 1 3,810        1,270 for each qualifying child
Year 2 2,540        850 for each qualifying child
Year 3 1,270        425 for each qualifying child

The definition of a qualifying individual is an individual who have been continuously unemployed for a minimum period of twelve months. The employer is entitled to a double deduction for qualifying employees in respect of:

Emoluments paid to those employees in the first 36 months of employment and
PRSI contributions on those emoluments

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Property Taxes

If you own a second property specifically for the rental market, there are many deductions you are allowed which can help reduce the tax you pay. They include:
-Rates
-Maintenance
-General expenses (excluding capital items)
-Insurance
-Advertising for Tenants
-Collection expenses
-Accountants fees
-Interest paid on loans to purchase, improve, or repair a residential premises
-Cost of any service or goods provided by the landlord, for which they do not receive a separate payment
-Legal expenses in drawing up leases
-Registration with Private Residential Tenancies Board.
-Wear & Tear allowances on capital items.