Tax Brief: Pre-Letting Expenses
Expenses incurred on rental properties prior to letting was previously disallowed as a deduction against rental income when computing taxable rental profits.
Finance Bill 2017 includes new measures permitting a deduction for pre-letting expenses incurred on previously vacant residential properties where:
- The property was vacant for at least 12 consecutive months before it is let
- The expenditure would have qualified as a rental deduction for tax purposes if the property had been let when the expenditure was incurred
- The amount of the deduction is capped at €5,000 per vacant property
If the property ceases to be let as a residential property within four years of its first letting, any relief claimed will be clawed back.
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