Irish Non-Resident Landlords

Many Northern Ireland residents have bought residential property in the Republic of Ireland as an investment. Living in Northern Ireland and owning and renting out a house in the South, classes you as a non-resident landlord in Ireland for tax purposes.

Landlord Tax Requirements
As a non-resident landlord receiving Irish rental income in any given year, you are required to file an Irish tax return by 31 October in the following year (15 November if filing online). If PAYE is your main source of income in the Republic of Ireland and the amount of tax owed on your rental income is not large, it may be collected through the PAYE system. If not, you will have to pay in October each year, under the Self Assessment tax rules.

Duties of a tenant when they have a non-resident landlord
Unless you formally appoint a collection agent in Ireland to collect rents on your behalf, your tenants are required to withhold 20% income tax on the gross rents they pay to you. The 20% withheld must be paid over to the Revenue. For example, if you charge your tenant €1,000 per month in rent, you should receive €800 and the remaining €200 should be paid over by the tenant to the Revenue.  The tenant must complete Form R185 (a certificate of the tax deducted) at the end of the tax year and give this to you. You will get a credit for any tax withheld by your tenants when you file your Irish tax return.

If you appoint a collection agent in Ireland, they must become registered for taxes in Ireland on your behalf and file an annual tax return in respect of your Irish rental income.  If a collection agent is appointed, the rents can be received gross from the tenants, without the tenants having to deduct income tax from the rent and make submissions to the Revenue Commissioners.  The same tax return filing deadlines will apply to the collection agent, as apply to you.  If your only source of Irish income is rental income, you can avoid the requirement to file a tax return yourself if the collection agent is filing a tax return on your behalf.

Non-Principal Private Residence (NPPR)
As well as having to file an Irish tax return and pay tax on your Irish rental receipts, you are also subject to an annual levy of €200 on residential rental properties. This charge is payable if you owned the property on the 31 March 2013.  The deadline for payment of this charge is 30th June 2013.  The NPPR applies for 2013, after which it will be abolished.

Local Property Tax (LPT)
LPT is calculated as a percentage of the value of your Irish property at 1 May 2013. Property values are organised into bands for the purposes of the LPT.  A tax rate of 0.18% is levied on properties worth up to €1m and a tax rate of 0.25% is levied on properties worth over €1m.  The LPT will apply to the mid-point of the valuation band your property value falls into.   If you are filing your Irish tax return online, you must submit your LPT return no later than the extended deadline of 1 July 2013 and make the LPT payment to the Revenue Commissioners by the same date.  For 2013 only, the LPT will be a half year charge, with the full 12 month charge payable in subsequent years.

Household Charge
The Household Charge came into force in Ireland on 1 January 2012 and applies to 2012 only – the charge is on a self-declaration basis and the landlord is liable for the charge, not the tenant. The tax was initially €100 but has now risen to €145 for June if you have not paid it.
From 1 July 2013, any outstanding Household Charge liabilities will be increased to €200 and added to the LPT due on the property. In effect, the arrears of the Household Charge will be converted into LPT and collected through the LPT system by Revenue.

Áine Devine