THOUSANDS of people around the country could be eligible for a new payment boost that would see them €1,160 a month better off.
The rent-a-room relief scheme is available to those who let out space in their home.
There are some exceptions to the payment[/caption]
Up to €1,160 a month could be paid out[/caption]
It’s a common idea seen mostly in cities and towns where housing is otherwise hard to come by.
Many students or those who are new to the country rent out a room in someone’s house in exchange for rent payments.
And it’s a little known fact that the payment could be exempt from tax.
The rent-a-room relief scheme aims to be an incentive for people to rent out space in their house.
It states that if you rent out a room in your house, the payment you receive could be tax free.
According to Revenue: “If you let a room in your home, the income you receive may be exempt from tax.
“The income you receive must not exceed the exemption limit of €14,000. If it does, then you are taxed on the total amount.
“Rent-a-Room Relief can only be claimed by individual taxpayers. It is not available to corporate entities.”
But there’s a few conditions which have to be met, the first of which being that the income cannot exceed €14,000.
If it does, you will be taxed on the whole amount.
But if the amount you receive through rent is below €14,000, you can claim it tax free.
It means a major boost in cash every month that could see bag an extra people €1,160.
Another condition is that there must be a continuous letting period, although some exceptions to this may apply.
Since 2019, a continuous letting period means longer than 28 days.
This means that anyone renting a room for a shorter period than 28 days cannot take pat in the rent relief scheme.
And the room must be in a “qualifying residence”, meaning the property must qualify to be part of the scheme.
However, there are some exemptions to the rule which mean that not everyone who rents a room will qualify.
Firstly, the tax relief does not apply if you are renting the room to your child or your civil partner.
It also does not apply if the room is rented to your employer or a short term guest.
Revenue set out the terms of the payments[/caption]
