Rent-A-Room Relief

The purpose of this eBrief is to advise of amendments to Part 7.1.32 of the Income Tax Manual (Rent-a-room relief) including the increase in the income limit (from €10,000 to €12,000) with effect from 1 January 2015 introduced by Finance Act 2014. The worked examples have been updated to reflect the higher income limit.

Income arising to an individual in respect of the letting, for residential purposes, of a room or rooms in his/her home, including income arising from the provision of meals or other services supplied in connection with the letting, is exempt from income tax, PRSI and USC where the income is below the annual limit for the tax year in question. However, income from the provision of accommodation to occasional visitors for short periods does not qualify for the relief as, in this scenario, the visitors use the accommodation as guest accommodation rather than for residential purposes.

In addition to the amendments relating to the increase in the income limit, this eBrief also confirms, in paragraphs 1 and 4.3 respectively, that the relief can apply in the case of lettings to students, but not in the case of guest accommodation, including where such accommodation is provided through online accommodation booking sites.

03 February 2015