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Tax in Ireland for non-resident landlords

Explanation of the tax requirements of Irish landlords who no longer live in Ireland. This article is for non-residents of Ireland who let our property and are looking to understand their tax requirements.

Last updated 2 August 2023 at 16:17

As a non-resident landlord living abroad, managing and keeping up with your tax liabilities can prove quite challenging. Not only can the process of managing these finances from outside of Ireland be complex, they can also prove to be much more time-consuming than your average resident tax affairs.

Below is a breakdown on your non-resident tax responsibilities, who is liable and what kind of information you need in order to go about filing your rental income tax return and paying your rental income tax the right way.

What qualifies as a non-resident landlord in Ireland?

If you actively rent out property in Ireland but reside in a different country, you will be classified as a non-resident landlord.

This will include living in Northern Ireland.

Despite living outside of Ireland as a non-resident landlord, all rental income will be subject to the same taxation as that of resident landlords in Ireland.

How can I pay my tax as a non-resident landlord?

Non-resident landlords must declare all their Irish rental property income to the Revenue Commissioners.

Non-resident landlords do have a choice of how they would prefer to pay their rental income tax (and how it is collected).

There are benefits to both and will ultimately come down to what method the landlord prefers in general.

A non-resident landlord in Ireland can either;

  • Nominate a designated (Irish resident) Collection Agent to assist with their rental income tax payments
  • Use a method called ‘Tenant Tax Withholding’ (not have the tenants pay in gross)

Collection Agents

A Collection Agent is essentially withholding a portion of the rent paid from the tenants, to cover all tax liability when it is due.

This Agent is the one that is accountable to the Revenue Commissioners for all rental income tax that is due.

They will hold their own Personal Public Service (PPS) number, which will be used solely for dealing with your property.

An arrangement will be put in place with the tenants to pass 20% of the monthly rental charge onto the Collection Agent, to then pay this to the Revenue Commissioners directly, as well as file an annual tax return on your behalf.

Put simply, this agent will act as an intermediary, taking care of all tax responsibility for the property and ensuring that all tax obligations are met.

This method can be very useful for both non-resident landlords that do not hold regular communication with their tenants, or that rent out multiple properties.

Using a Collection Agent can eliminate the financial risk of late penalties or errors that could occur when operating without a nominated professional, as well as provide peace of mind knowing that your tax duties as a non-resident landlord are taken care of for you.

Your nominated Collection Agent must however, be resident in Ireland. Personal contacts that you trust can be used, but professional service providers such as accountants or rental agency's are always recommended.

‘Tenant Tax Withholding’

Some non-resident landlords who either hold frequent communication with their tenants, or who have some kind of established relationship with their tenants (family/ friends/ long term tenants) may prefer to arrange ‘Tax Withholding’.

This means that opposed to the tenant paying the gross monthly rental payment, the tenant will pay 80% of their monthly rent fee to yourself, while withholding 20% back to pay directly to the Revenue Commissioners on your behalf.

The main reasons that this method was brought in to play in Ireland was both to make the person responsible for payments have to be present in Ireland, as well as making the process of payments and refunds much more straightforward if needed.

Can I still claim Tax Reliefs as a non-resident landlord?

You will still be entitled to certain tax reliefs (in the form of expenses), the same as resident landlords who do reside in Ireland.

Some of the specific expenses that you may be able to claim as a non-resident landlord which can lower the amount of tax you owe to Revenue can include:

  • Qualifying Mortgage Interest – Deduction from the interest which accrues on the loan of your mortgage, once your tenants are registered with the Residential Tenancies Board
  • Residential Tenancies Board Registration Fee – A fee paid (€90 per tenancy) to the Private Residents Tenancy Board within one month of the start date of the tenancy

Filing a non-resident tax return

Non-resident landlords are required to file and pay their income tax returns by 31st October each year.

Form 11 will be necessary if your net income exceeds a total of €5,000 (registering you for self-assessment and declaring your rental income).

If your net income is below €5,000, this can be declared as non-PAYE income, which is done via the Revenue Commissioners online website.

Choosing not to use a Collection Agent and opting for tenant withholding will also mean submitting Form R185 (which will allow you to claim this payment).

It is essential to seek advice when unsure on your tax responsibilities and can ultimately help you to avoid costly errors and penalties.

Speak to a Irish tax specialist to ensure you are doing things correctly

If you need help with your Irish tax returns, whether related to property, or other assets, you should seek qualified advice from an Irish tax specialist.

Our free introduction service will connect you with a trusted Irish tax specialist who will invite you to book an initial 30 minute consultation for €255. During the consultation, the specialist will be able to provide formal Irish tax advice and detail any other services or options you may need to get you Irish tax matters in shape, including:

  • Establish your current Irish tax residency status, including recommendations on how you could reduce your tax burden
  • Understand and apply any relevant double tax treaties
  • Identify opportunities to make your income and gains more tax efficient

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