Michael McGrath (Cork South Central, Fianna Fail)
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To ask the Minister for Finance the taxation obligations of a person who is paying rent to an overseas landlord; if he will clarify the nature of the guidance or advice provided to such a person; the way a tenant will be dealt with if they were dealing with an agency and were genuinely unaware the landlord was based abroad. [4437/13]

Michael Noonan (Limerick City, Fine Gael)
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I am advised by the Revenue Commissioners that under existing tax legislation a tenant paying rent to a non-resident landlord in respect of property located in the State, is obliged to deduct income tax from the gross rent at the standard rate, which is currently 20%, unless the non-resident landlord is assessable and chargeable to income tax here in the name of a representative in the State. I am further advised by the Commissioners, that they have raised awareness of this legislative requirement by, for example, including relevant material in operational instructions on the Revenue website (Chapter 45.1.4 of the Income Tax/ Capital Gains Tax /Corporation Tax Manual) and on relevant forms. In that regard, the Rent Tax Credit leaflet and Form Rent 1, which is used by tenants to claim tax relief on rent, contain information on the tenant’s obligation to deduct tax in certain circumstances.

The Commissioners have also indicated to me that where a tenant, who would have been required to deduct tax, has acted in good faith and was genuinely unaware of his or her obligation or of the residence status of the landlord, Revenue take a practical approach and generally only seek to apply the legislation prospectively from a current date.