How Budget 2025 Benefits Irish Landlords: Key Reliefs and Supports for Rental Success

Budget 2025 has introduced important measures to support Irish landlords in maintaining and improving their rental properties. Key reliefs include extended tax deductions for vacant property preparation, mortgage interest relief on rising rates, increased rent tax credit to aid tenant retention, and elevated incentives to rent vacant homes. Here’s a closer look at each benefit and how landlords can make the most of them.

Howley Souhan & Co. are trusted experts in the local lettings market, with years of experience guiding landlords through the complexities of letting and property management. From initial property valuation to securing tenants, Howley Souhan & Co. offers comprehensive support designed to maximise rental income and ensure compliance with the latest regulations. Whether it’s navigating tax relief options or optimising property for lettings, their team provides personalised advice tailored to every landlord’s needs, helping clients stay informed and achieve consistent rental success.

For those looking to leverage Budget 2025’s new supports, Howley Souhan & Co. is well-positioned to offer insight and strategies that help landlords make the most of these benefits in today’s evolving market.

Extended Pre-Letting Expense Relief to 2027

For landlords with vacant properties, the extension of pre-letting expenses relief through 2027 provides a significant tax benefit. This measure allows landlords to claim tax deductions on expenses necessary to bring a vacant property back into the rental market, easing the upfront costs of preparing a property for tenants. Key details include:

• Eligible Properties: Properties vacant for 12 months or more before being let.
• Qualifying Expenses:
  • Minor Repairs: Fixes to fixtures, fittings, or structural components.
  • Cleaning and Preparation: Deep cleaning or improvements to make the property tenant-ready.
  • Advertising Costs: Costs associated with marketing the property to potential tenants.
  • Other Refurbishment Expenses: Small renovations or cosmetic changes to improve property appeal.
• Claim Process: Property owners must maintain clear documentation of all expenses to claim deductions accurately.

Pro Tip: Landlords should consider using this relief to update older properties or properties that require minor modifications before letting. This could increase rental income and tenant appeal.

Mortgage Interest Tax Relief for Landlords Facing Rising Rates

With many landlords impacted by higher interest rates, Budget 2025 offers relief through mortgage interest tax deductions. Landlords with outstanding mortgages can claim up to €1,250 to offset the increased interest they paid in 2023 compared to 2022. Here’s how it can help:

• Eligibility:
  • Outstanding mortgage balance must fall between €80,000 and €500,000 on the primary residence.
  • Relief is calculated based on the interest paid in 2023 over 2022.
• Relief Cap: Up to €1,250 in tax relief per property.
• How to Claim: A personal tax return must be filed with Revenue, with mortgage documentation attached to support the relief claim.

Pro Tip: Landlords should keep detailed mortgage statements and interest calculations to streamline the filing process. For those with multiple properties, this relief could help offset the cumulative effect of rising interest costs.

Prioritising Property Maintenance for Successful Lettings

Keeping rental properties in excellent condition is vital for retaining tenants and maximising rental value, especially in a competitive market. Howley Souhan & Co. understand that proactive maintenance is essential, offering full-service solutions to handle everything from emergency repairs to ongoing upkeep. By partnering with a trusted property management firm like Howley Souhan & Co., landlords benefit from streamlined maintenance processes, reducing vacancies and ensuring properties remain attractive to tenants.

Key areas of maintenance that contribute to property success include:

• Routine Inspections: Regular checks identify issues before they escalate, helping to control repair costs.
• 24/7 Repair Services: Access to emergency maintenance keeps tenants satisfied and protects property value.
• Long-Term Upgrades: Investing in energy-efficient appliances or modern fixtures increases property appeal and may command higher rental prices.

With Howley Souhan & Co.’s dedicated maintenance services, landlords can focus on their investment’s growth while ensuring that their properties remain in top condition year-round. For more on Howley Souhan & Co.’s maintenance support, learn more here.

 

Increased Rent Tax Credit Boosts Affordability for Tenants

The 2025 budget raises the Rent Tax Credit, which provides substantial financial support to tenants and indirectly benefits landlords by supporting tenant affordability and retention. Details of the increase:

• New Credit Amounts:
  • €1,000 for individual tenants.
  • €2,000 for jointly assessed couples.
• Eligibility:
  • Tenants must meet the income requirements to claim the credit.
  • Applies to tenants renting privately, enhancing affordability in competitive rental markets.
• Impact on Landlords:
  • Higher tenant affordability can stabilise demand.
  • Reduced turnover as tenants are better able to manage rental costs.

Pro Tip: Landlords can highlight the availability of this credit to prospective tenants as a way to offset rising rental costs. This can also increase tenant loyalty and reduce vacancy rates.

Higher Vacant Homes Tax Encourages Active Rentals

To further motivate landlords to bring vacant properties into the rental market, Budget 2025 has increased the Vacant Homes Tax to seven times the property’s Local Property Tax (LPT) rate. This measure is designed to penalise property owners who leave homes vacant for prolonged periods, incentivising them to either rent out or sell these properties. Key points include:

• Tax Rate: Now set at seven times the property’s LPT base rate, up from five.
• Properties in Scope: Applies to properties that remain unoccupied for fewer than 30 days in a 12-month period.
• Exemptions: Properties left vacant due to legal, health, or other significant reasons may be exempt.

Pro Tip: For landlords with properties that have been empty, consider leasing them to avoid this tax. Alternatively, short-term improvements or targeted tenant marketing may make these properties more attractive and mitigate the financial impact of the vacant property tax.

Conclusion: Preparing for Success in 2025

Budget 2025 has created a supportive environment for landlords looking to maximise their rental property’s potential. With tax relief options for both vacant properties and mortgage interest payments, as well as incentives for tenant affordability, landlords are better equipped to sustain and grow rental income. Proper planning and documentation will be key to taking advantage of these new measures, ensuring landlords can navigate the evolving market with confidence.

Ready to make the most of Budget 2025’s landlord benefits? 

Let Howley Souhan & Co. guide you through tax reliefs and rental strategies. Contact us today to maximise your rental property’s potential and secure sustainable income!

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