Rental Property Expenses

If you are renting a property, you need to register with the Private Residence Tenancy Board (PRTB) as this will allow you to claim for a portion of interest on the mortgage for the property you are renting out. Note that it is only the mortgage interest which you can claim for and not the whole mortgage payment.

As well as mortgage interest, you can claim for any expenses which relate to the property that occur after the date of first letting, i.e. from when your tenants first move in. These include:

• Mortgage interest on loan to acquire property (restricted to 75% of interest for residential property)
• Repairs, for example damp and rot treatment, repairing broken windows or appliances(though not if you carry out the repair work yourself)
• Maintenance, for example cleaning, painting or decorating
• Management and estate agent fees
• Advertisement expenses
• Insurance premiums
• Legal fees incurred when drawing up the lease
• PRTB registration fee
• Most mortgage protection policy premiums
• Fees paid to accountants for preparation of rental accounts
• Service charges if these are paid by the landlord and no separate payment is received from the tenant(s), for example bin charges, electricity, gas, phone rental etc
• Rates paid to a local authority

There is also an allowance for wear and tear of furniture and appliances. 12.5% of the cost of furniture and appliances can be offset per annum for 8 years. For example, if you purchase furniture for €1,000, for the next 8 years you can offset €125 each year against the rental income (1000 * 12.5%). It is important to note that mortgage interest tax relief at source (MITRS) cannot be claimed while renting out a property.

Date published 4 Sep 2013

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.