Rental income from residential property in the Republic of Ireland is subject to tax, regardless of whether or not the owner is resident in Ireland. Owners of rental property in Ireland who are in receipt of rental income are obliged to declare this income by submitting an annual tax return to the Revenue Commissioners of Ireland.
Rental income is calculated on the basis of the gross amount of rent received with profits and losses calculated separately for each rental source. The rental income subject to tax is the aggregate of the profits reduced by the aggregate of the losses.
Rental income from property situated outside the Republic of Ireland is subject to tax for individuals who are resident and domiciled in Ireland, although double taxation treaty relief may be applicable.
When rent is paid directly to a non-resident landlord, the tenant is obliged to deduct income tax at the standard rate from the payment. The tenant then gives the landlord a certificate of the tax deducted on Form R185. The landlord is entitled to claim relief for expenses which are usually allowed in arriving at the rental profit, and may be entitled to a proportion of personal allowances. Your dedicated PTI Account Manager can go through the full Revenue obligations with you.
Purchasing an Irish Residential Property
If you’re buying residential property in Ireland there are two types of tax you need to be aware of:
Stamp duty is a type of tax that is charged when purchasing property. For properties with a value of up to €1 million, the rate is 1% with the balance at a rate of 2%.
VAT is payable in Ireland @ 13.5% on new builds. There is no VAT payable on second-hand residential properties in Ireland. It is advisable to seek professional VAT advice in this respect.
Local charges apply for services such as refuse collection and water. These are set by the Local Council / Corporation and vary according to the location.
Local Property Tax
Property tax is based on the value of the residential property. New properties are exempt from this.