Non Resident Landlord: Guide to Irish Tax Returns

Guide to Irish Rental Income Tax Returns & Appointment of Collection Agents for Non Resident Landlords

If you own rental property in Ireland but are not currently living in the country, you are considered a non resident landlord.

All non resident landlords must declare any Irish rental property to the Revenue Commissioners. Additionally they must appoint a Collection Agent or put in place an arrangement with tenants to pass 20% of the monthly rental charge to the Revenue Commissioners. Of course, they must also file a tax return for any income earned, and pay any rental income tax for which you are liable.

Managing and filing your taxes while living abroad can be both frustrating and time-consuming, so it’s important that you have all the information you will need before you sit down to file. Our expert accountants here at Tax Return Plus have compiled this guide to help you understand how to go about filing your rental income tax return as a non resident landlord.

Tax Return Plus Collection Agent & Tax Agent Service

Tax Return Plus not only offers the service to act as tax agent but also as a Collection agent if required. This combined service simplifies the process for non resident landlords. With Tax Return Plus acting as collection agent, rent paid to non resident landlords is paid directly from their tenants or letting agent to the landlord, with Tax Return Plus ensuring all taxes are paid in full and on time.

If you’re wondering about your tax liability as a non resident landlord and how to claim any available tax breaks for landlords, our team has got you covered.

What is a Non Resident Landlord?

You are classified as a non resident landlord if you rent out property in Ireland but live/reside in another country (including Northern Ireland). Any rental income you earn from these properties while you are living abroad is subject to the same taxation as that of Irish-resident landlords.

There are particular rules for non resident landlords including the appointment of a Collection Agent that specify how rental income tax can be paid. It’s important that you understand these, as non-compliance can have serious repercussions for both non resident landlords and the tenants renting their properties.

How Do I Pay Tax as a Non Resident Landlord?

Non resident landlords have two different options when it comes to collecting rent and paying tax on those earnings.

You can nominate an Irish-resident “collection agent” such as Tax Return Plus to manage your Irish tax filing.
Your tenants can withhold the rental income tax rate (20%) of their rent and pay this directly to the Revenue Commissioners on your behalf. You will then claim this as a credit when you file your income tax return.

Regardless of your course of action here, it’s important to remember that your taxes must be filed and paid by October 31 of each year.

Should I Use A Collection Agent?

There are benefits to both methods of paying rental income tax as a non resident landlord.

Using a Collection Agent

Nominating a collection agent to manage your taxed in your stead can be very handy and using the services of Tax Return Plus for this task insures a professional and secure service.

While making an arrangement with your tenant may seem like the easier route, your tenant(s) may not want the burden of paying tax on your behalf, and there is no guarantee for you that your tenant will actually do so. This could lead to a messy situation you don’t want to deal with while living abroad.

A Collection Agent is someone resident in Ireland – it can be a personal contact you trust, such as a family member or friend, or a professional service provider such as an accountant or rental agency – you appoint to be responsible for filing and paying your rental income tax each year.If you do not wish to place this responsibility on a family member or friend, then Tax Return Plus offer a great alternative in acting as Collection Agent.

This method often works best for non resident landlords who have little to no contact with their tenants, or landlords with multiple properties. In these scenarios, nominating a Collection Agent can actually save you money in the long run, as unpaid, incorrect or overdue tax payments can incur significant penalties.

Non Resident Landlord Withholding Tax

In this scenario, instead of collecting 100% of your rental income and then paying out 20% tax on these earnings at the end of the year, you can arrange that your tenant pays you 80% of their rent, withholding the 20% to pay directly to the Revenue Commissioners on your behalf.

Confused? We don’t blame you! Here’s an example that might help:

Mary lives in New York and owns a house in Galway, which she rents to Joe and his family. The rental agreement, signed by both Mary and Joe, states that Joe’s rent is €950 per month (€11,400 annually).

Instead of making monthly payments of €950, however, Joe pays Mary €760 (80%) each month. Joe then sends the remaining €190 to the local tax office on Mary’s behalf.

At the end of the year, Joe fills a Form R185 and sends it to Mary, who uses the form to claim a tax credit on her income tax return.

This method often works best for long-term and trusted tenants, or for landlords and tenants with an established relationship (such as friends of the family).

What Tax Reliefs Can I Claim?

Non resident landlords are entitled to the same tax relief in the form of expenses as landlords who live in the Republic of Ireland. Some examples of the expenses you can claim to reduce the overall amount of tax you end up paying to Revenue include:

RTB Registration Fee. You need to pay this fee of €90 per tenancy to the Private Residents Tenancy Board within one month of a tenancy start date. The registration fee can be claimed as a deductible expense to provide tax relief.
Qualifying Mortgage Interest. If you secured a mortgage to purchase, repair or renovate a residential rental property, you may deduct 100%* of the interest accruing on the loan once your tenants are registered with the RTB.
Pre-letting expenses: The Finance Act 2017 introduced a helpful deduction for pre-letting expenses on vacant residential properties. This means Landlords can claim back up to €10,000 (increased from €5,000 in 2023) for expenses incurred to prepare your property for renters.
Management, Accounting and Agent Fees. You can deduct fees paid to a property management company or agent to collect rent and manage the property on your behalf from the tax you pay. You can also claim any professional fees such as Accountancy Fees.
Insurance Premiums. Landlords who buy insurance policies to protect their rental properties can deduct the premiums as an allowable expense.

Tax relief on rental income 2024–2027

A temporary rental income tax relief was introduced in 2024. The relief will be available against some rental income at the standard rate of 20% each year. It will be available from 2024 to 2027 and will only apply if the landlord keeps their rental property in the rental market for the 4 years. Landlords can get 20% of:

€3,000 for 2024
€4,000 for 2025
€5,000 for 2026 and 2027

The relief will reduce the tax due on rental income by up to €600 in 2024, €800 in 2025, and €1,000 in 2026 and 2027. The relief will be clawed back if the landlord leaves the rental market during this time.

How Do I File My Non Resident Landlord Tax Return?

Non resident landlords living outside of the Republic of Ireland are required to file and pay their income tax returns by October 31 each year.

If your net income exceeds €5,000 you will be required to register for self-assessment and declare your rental income by completing a Form 11. If your net rental income is less than €5,000, you can declare this income as non-PAYE income using the Revenue Commissioner’s online platform.

If have decided not to use a Collection Agent and instead have your tenants withhold and pay your rental income tax, don’t forget to submit the Form R185 they have filled out in order to claim this payment.

Need Help Claiming Your Landlord Tax Reliefs?

If you are a non resident landlord filing and/or paying your rental income tax this year, don’t waste your time getting caught up in the details! We help non resident landlords around the globe file and pay their rental income tax returns. Find out more about tax on rental income or get a quick quote to get started.

If you found this guide helpful, make sure you check out some of our other helpful guides.