Declare your rental income before the tax man approaches you about it

If you have a rental property and have never put in tax returns in relation to it, now is a good time to do something to legitimize it. The Irish revenue commissioners appear at the moment to be investigating people with second properties who haven't declared rental income. They seem to be getting information from the Private tenancy board database and from social welfare payments and of course all properties when purchased are subject to stamp duty and so all your properties are linked to your pps number. I certainly have had new clients come in recently who have got letters from the revenue commissioners asking about undeclared rental incomes. Remember also if you have a rental property with a mortgage on it then you can only claim the interest against your rental income if you are registered with the ptrb and since April 2009 only 75% of the mortgage interest is allowable. However giving the fall in rents in Ireland and the high prices paid for property in the boom years, a lot of people still wont have taxable profits on their rental property. If you have made a loss then no income tax will be payable, so there is no point in not putting in income tax returns for it. However rental looses are generally ring fenced for offset against other rental income so the losses can't be used to claim tax paid on other income I.e paye income.