Rental Tax Return Services

Both residents and non-residents will have a filing requirement if they receive any income
that falls outside the PAYE system, for example, rental income from either domestic or international sources.

The amount you earn and from what sources will determine if you have to file Form 11, Form 12, Form CG1, or Form IT38.*A chargeable person is someone who is in receipt of income liable to tax under the PAYE system and is also in receipt of gross non-PAYE income of €30,000 or more from other sources, such as trading or rental income, etc. Even if your gross income is less than €50,000 you also will be regarded as a chargeable person if your net income (after deduction and allowances) is more than €5,000 net. Also note that if your gross income has been reduced to nil or a negligible amount because of deductions, losses, allowances, and other reliefs you will be still regarded as a chargeable person.

Form 11 will be required for any individual who is deemed to be a chargeable person.
Self-assessment customers are required to file Form 11 which is mandatory for individuals with significant income from non-PAYE sources.

In general, most PAYE workers are not required to file a Form 11, but are required to do so in certain circumstances where the non-PAYE income received is more than €30,000 gross per annum or greater than €5,000 net per annum. Company directors who own more than 15% of a company (i.e. proprietary directors) will have to file a Form 11, even if the majority of their income comes from the PAYE system. You will also be regarded as a chargeable person if you open a foreign bank account, acquire a foreign life policy, or have a material interest in an offshore fund or exercise share options.

The deadline is 31 October in the year following the tax year to which the return relates
(i.e. for the 2023 tax year, the return is due on 31 October 2024). An extension of approximately two weeks is granted for online filing via Revenue’s Online System (ROS).

A Form 12 tax return is completed by those whose primary source of income comes from PAYE
income. In general, most PAYE workers do not have to complete Form 12 as they do not meet the criteria required to file a tax return. Revenue may also randomly select PAYE workers and issue a Form 12 for completion regardless of their income threshold.

People with an income of up to €5,000 net income and €30,000 gross income per annum from non-PAYE sources should also complete a Form 12. If the non-PAYE income is above this amount, a Form 11 tax return will have to be submitted.

Form 12 has the same deadline as Form 11 (31st October in the year following the tax year to which the return relates).

Yes, if you receive income from outside the PAYE system, you are legally obliged to file a tax return. Additional sources of income may include rental income (both domestic and foreign), share dividends, capital gains from the sale of assets, deposit interest from a foreign bank account, investments in off-shore funds, or any such source of income not subject to PAYE tax.

Failing to comply with tax laws can lead to late filing penalties of either 5% or 10% and interest accruing on any outstanding tax liabilities. The severity of the penalty will depend on several factors, such as the amount of tax owed, the time delay between the tax return being submitted, and the actual due date of submission.

When a couple first marries they continue to be taxed as two single individuals under the Irish tax system. If the tax paid by both individuals is higher at the end of the year than if they were taxed as a married couple, a tax refund will be due. An Irish tax refund would occur in this instance where one spouse was on a different tax rate than the other and there were unused tax credits as a result of the new union.

Yes, Revenue allows the following options for married couples under the Irish tax system:

• Joint Assessment or Aggregation
• Separate Assessment
• Separate Treatment / Assessment as Single Individuals

The most common form of taxing married couples in Ireland is a joint assessment which is generally the most beneficial financially. One spouse will assume responsibility for the joint tax
liability and is generally referred to as the ‘assessable spouse’. The other spouse is referred to as the ‘non-assessable spouse’.

The Assessable Spouse:

1. Will have their combined income assessed for Irish tax purposes.
2. Receives standard tax rate banks and combined tax credits.
3. Is required to file a joint Irish tax return and include all details about the couple’s
   combined income.

Yes, the couple must elect to have themselves registered for joint assessment by 31st March in
the year following their marriage.

Yes, the married couple can elect to have their tax relief and tax credits split between them,
but it should be noted that employment expenses and PAYE tax credits are not eligible for transfer.

Revenue will issue two tax certificates to a married couple where both spouses are in employment.

Yes, a married couple can choose to be taxed separately and file separate Irish tax returns if
required. This is known as ‘separate assessment’.

Under this method following credits are equally divided between spouses:

• Married Personal tax credit
• Age tax credit
• Blind tax credit
• Incapacitated Child tax credit

Where there are unused credits or standard rate bands (other than the Employee tax credit and Employment expenses or the increase to the standard rate band) this can be transferred to the other spouse in the following tax year.

This is a common situation that we are seeing more and more of lately. From your resident country’s point of view, this is perfectly fine but there are two situations here that should be noted:

• Firstly, when you include your foreign rental income with your annual resident tax return, there are often several deductions that are not included as each tax system has its own rules and regulations. Unless the person preparing your resident return is familiar with the foreign tax system and speaks the language, they will not know what costs can be written off. This is also the most inefficient tax method for declaring your income as, in addition to the above you will also be subject to income tax which in many cases can be above 40%.
• Secondly, while the above situation will meet your tax obligations in your resident country, you may not meet your tax obligations in the overseas country, which can leave you exposed to the possibility of fines, penalties, and interest being imposed by the foreign tax office.

If you receive rental income abroad, your first obligation is to the tax authorities where the income was received. The main objective of any tax return is to reduce your taxable income by as much as possible. Once the taxable income is determined, tax is paid based on the income tax rate applicable to non-residents (if different than the resident income tax rate).

If a tax liability is due, a payment is made to the tax office. It is at this point that the Double Taxation Agreement (if available) would come into force which would ensure that you do not pay tax twice on the same income.

Declaring income in the overseas country first is the most tax-efficient way of ensuring your taxes are in order. PTI Returns can provide more advice on this if you’re unsure of your obligations. We can help you stay tax-compliant across multiple jurisdictions.

Separate treatment or Single Treatment is not to be confused with Separate Assessment. Under separate treatment, each spouse is considered an individual and is taxed under the same method as a single taxpayer.

Under this method each spouse:

1. Has an obligation to file a personal Irish tax return.
2. Is assessed on his/her income.
3. Is treated as a single person and therefore receives the equivalent tax credits and rate bands as a single taxpayer.
4. Has no right to claim relief for payments made by the other spouse.

Rent paid to a non-resident landlord is subject to specific guidelines. Your Account Managercan provide you with more information on your obligations.

For a list of the double taxation treaties Ireland has entered into, click here.