Tax relief for tenants

Information

If you live in private rented accommodation in Ireland and pay income tax, you may be eligible for tax relief on part of your rent.

Rules

In order to claim tax relief, you must be paying rent for private rented accommodation which is used as your sole or main residence. This includes accommodation such as a bedsit, flat, apartment or house.

You cannot claim tax relief for rent paid as follows:

• To a local authority or a State Agency 
• Rent paid under a lease agreement for 50 years or more.

Landlords or agents living in Ireland

If your landlord or agent is resident in Ireland, a receipt for rent you have paid must be provided if and when it is requested by Revenue. This rule applies regardless of whether you pay your rent directly to the landlord or to an agent on behalf of the landlord. Each receipt must show the following:

• Landlord's name, PPS Number and address
• Amount of rent which you have paid
• Period of time covered by the receipt.

Landlords living outside Ireland

If your landlord lives outside Ireland and you pay rent directly to them or to their bank account located in Ireland or abroad, you must deduct tax at the standard rate (20%) from the gross amount which you pay. This deduction is not your tax relief, it is tax payable to Revenue from your landlord's income. For example, if your landlord lives in Germany and you pay him/her gross rent per month of €1000. Firstly, calculate the amount of tax to be deducted (€1000 x 20% = €200). Now deduct the tax due from the gross rent you pay (€1000 - €200 = €800 ). Your monthly rent paid to your landlord is €800 per month. Your monthly return paid to Revenue is €200 per month. 

You must account for the tax you deduct by making a tax return to Revenue and paying over the tax you have deducted from your landlord. You can make a return immediately but in practice this rarely happens. Instead, if you are a PAYE employee you can pay over the tax deducted when you submit your annual Tax Return Form 12 to Revenue . If you pay tax by self-assessment, you can account for the tax you deduct in your annual self-assessment Tax Return Form 11 which you send to Revenue.

At the end of the year you must give your landlord a completed Certificate of income tax deducted - Form R185 (pdf). If you fail to deduct tax from rent you pay to a landlord living outside Ireland will mean that you (and not the landlord) will be liable for any tax which should have been deducted.

Rates

Tax relief at the standard rate of 20% on private rented accommodation is available whether your landlord lives in Ireland or abroad. In 2010 the tax relief on rent is as follows (the same limits applied in 2009):

To calculate what this is worth to you each year after tax, you multiply the tax allowance amounts above by 20%. So, for those aged:

• Under 55: the maximum amount a single person under 55 can get is €400 (€2,000 x 20%) for rent paid in 2010. The maximum amount a married couple or widowed person can get is €800 (€4000 x 20%) for rent paid in 2010.  
• Over 55: the maximum amount a single person over 55 can get is €800 (€4,000 x 20%) for rent paid in 2010. The maximum amount a married couple or widowed person can get is €1,600 (€8,000 x 20%) for rent paid in 2010. 

How to apply

Whether you landlord lives in Ireland or abroad, to claim rent relief you must complete Form Rent 1 (pdf) and send to your tax office. (Copies of the form are also available from your local tax office). If you have any difficulty completing the form or supplying any of the information requested, staff in your tax office will be happy to help you.

Where to apply