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Non-resident landlords Changes from 1 July 2023

PSC Accountants & AdvisorsFeatured Non-resident landlords Changes from 1 July 2023

Non-resident landlords Changes from 1 July 2023

Non-resident landlords Changes from 1 July 2023

 

Finance Act 2022 introduced changes to the obligations of tenants and collection agents of non-resident landlords.

These changes are pending the introduction of a new Non-resident Landlord Withholding tax platform (“NLWT”).  This will be accessible through Revenue Online Service (ROS) and MyAccount. This new system will be available from the 1st of July 2023.

Collection agents will:

  • no longer be designated “chargeable persons” for tax purposes and will not be responsible for filing a Tax Return for the rental income
  • withhold and remit 20% of the rental payment and make a Rental Notification (RN) through a new withholding tax platform in MyAccountand ROS
  • be able to issue Rental Notifications (RN’s) in bulk.

Non-resident landlords should note:

  • the removal of all current derogations
  • that they will be responsible for filing Tax Returns from now on.

Tenants paying directly to a non-resident landlord:

  • will no longer be designated “chargeable persons” and will not be responsible for accounting for the withholding figure of 20% on their personal tax return
  • will withhold and remit 20% of the rental payment and make a Rental Notification (RN) through a new withholding tax platform available on MyAccount.

 

Non-Resident Landlord Withholding Tax (NLWT) System

The new NLWT system will enable tenants or collection agents to make Rental Notifications (RN’s) when making payments to a non-resident landlord. This notification and accompanying payment needs to be submitted within 21 days of paying the rent to the non-resident landlord.

 

The system will be available to the collection agent, the landlord and the tenant. Landlords will be able to claim the withheld credits on their annual Tax Return.

A non-resident landlord will be obliged to confirm certain information to either the collection agent or tenant to enable them to fulfil their obligations under the new legislation.  Amongst others, the two key items of information include:

  • confirmation of non-residency status to the collection agent or tenant, and
  • confirmation of the Tax Reference number (either income tax or Corporation Tax as appropriate) to the collection agent (if there is one), and the LPT ID of the rental property to either the collection agent or tenant.

These identifiers will enable the collection agent or tenant to make Rental Notifications on the new system which ensures that the withheld payments will be credited to the landlord when he makes his annual tax return.

Further information will be provided by Revenue shortly and in advance of 1 July 2023.  We will keep you informed of any developments.