Catherine Murphy (Kildare North, Independent)
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To ask the Minister for Finance the arrangements in place to tax rental incomes from properties located abroad; the tax that is applied; if it is dependent on self declaration; and if he will make a statement on the matter. [41306/12]

Michael Noonan (Limerick City, Fine Gael)
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I am advised by the Revenue Commissioners that rental income received by a property owner who is resident or ordinarily resident in the State from property located outside the State is taxable here under the provisions of the Taxes Consolidation Act 1997. Taxable rents from such property are generally computed on the full amount of the rent arising, after deducting allowable expenditure, irrespective of whether the rent has or will be received in the State. However, where an individual is not domiciled here taxable rents are computed on the basis of the actual sums received in the State, without deduction.

Taxable foreign rents form part of the property-owner’s total taxable income and are subject to tax at the applicable rates in force when the charge to tax arises, currently 20% and 41% for income tax and 25% for corporation tax. They are also subject to the Universal Social Charge in the hands of an individual. Depending on the circumstances, the owner may be entitled to relief for tax paid on the rent in the country in which the property is located.

The self-assessment system applies in the normal manner to persons who receive rent from foreign property. As such, they are required to pay any tax and submit their annual tax return in a timely manner and are subject to the general self-assessment provisions relating to non-compliance and the audit of annual returns. I am also advised that Revenue's overall approach to the taxation of foreign rental income is underpinned by close consultation and cooperation with other agencies and other EU Member States and Revenue receives information on the ownership of foreign property from other countries under Mutual Assistance Agreements. Data sharing on this matter is on a continuous and on-going basis.