1. What is Rental Income Tax in Ireland?

Rental income tax in Ireland is calculated on the profit you make from renting out property after deducting allowable expenses. The tax includes income tax, PRSI (Pay Related Social Insurance), and USC (Universal Social Charge).

2. How Does the Calculator Work?

The calculator uses the following formulas:

Where:

• Gross Rental Income — Total income from property rental
• Allowable Expenses — Deductible expenses related to the rental property
• Tax Rate — Standard rate (20%) up to cut-off point, higher rate (40%) above
• PRSI — Pay Related Social Insurance (typically 4%)
• USC — Universal Social Charge (typically 4%)

3. Understanding Allowable Expenses

Details: Allowable expenses include mortgage interest (for non-PPR properties), property maintenance, insurance, management fees, and other costs directly related to renting the property.

4. Using the Calculator

Tips: Enter your total rental income and all allowable expenses. The calculator will show your taxable income and the estimated tax due. Default tax rates are set but can be adjusted.

5. Frequently Asked Questions (FAQ)

Q1: What's the standard tax rate for rental income?
A: The first €35,300 (single person) is taxed at 20%, with the balance at 40%. Different thresholds apply for married couples.

Q2: Can I deduct mortgage payments?
A: Only the interest portion of mortgage payments is deductible, not the principal repayment.

Q3: Are there any tax credits available?
A: You may be eligible for certain tax credits depending on your personal circumstances.

Q4: How is PRSI calculated on rental income?
A: PRSI is typically 4% of your rental profit if you're self-employed or 0% if you're an employee paying PRSI through your employment.

Q5: When is rental income tax due?
A: Rental income is taxed in the year it's earned through the self-assessment system, with preliminary tax due by October 31st each year.