Dáil Éireann Debate, Tuesday - 16 April 2013
286. Deputy Michael McGrath asked the Minister for Finance his plans to allow the local property tax to be offset against rental income in respect of an investment property; and if he will make a statement on the matter. [16721/13]
View answerThe Inter-departmental group, chaired by Dr Don Thornhill, to consider the design of a property tax (the "Thornhill Group") recommended that the Local Property Tax (LPT) paid in respect of a rented property should be deductible for income tax or corporation tax purposes, in a similar manner to commercial rates. The Group recognised the considerable pressures on the public finances and the need to bridge the gap between expenditure and revenue, and, for this reason, the Group suggested that consideration be given to phasing in deductibility over a period of years. The Group also considered that it is for Government, having regard to the prevailing budgetary situation, to decide on the time span for phasing-in deductibility and on what percentage of LPT to allow as a deduction from gross rents for tax purposes.
The Government accepted the recommendation of the Thornhill Group on this matter. While there is no provision in the current legislation on the taxation of rental income that deductions in respect of LPT paid are allowable, it is the intention of the Government to introduce such a provision on a phased basis.
Neither the manner in which this will happen or the timing has yet been decided.
