Questions and Answers

Rental Property Losses

Q: I have been renting out my property for 2 years but have never paid tax when filing my return, as I was making a loss. I think I will make a profit this year, how will this affect my return? Can I offset this loss against my employment income?

A; If you have incurred a loss on your rental property in previous years, this can now be brought forward when preparing your 2014 tax return. The loss can be offset against your 2014 rental income to reduce the taxable profit. Any unused loss in 2014 can then be carried forward for future offset. Losses forward can be very useful to have as the tax on rental profits can equate to approximately 52%, depending on how much your other earnings are.

Unfortunately Irish rental losses can only be offset against Irish rental profits in the year, or carried forward to offset against future rental profits. They cannot be offset against other sources of income (such as Employment income/foreign rental profits/deposit interest income).

Date published 31 Jul 2015

This article is intended to inform rather than advise and is based on legislation and practice at the time. Taxpayer’s circumstances do vary and if you feel that the information provided is beneficial it is important that you contact us before implementation. If you take, or do not take action as a result of reading this article, before receiving our written endorsement, we will accept no responsibility for any financial loss incurred.

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