Cathal Crowe (Clare, Fianna Fail)
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184. To ask the Minister for Finance if he will consider giving a tax concession to small-scale landlords in Budget 2024, in line with the tax concession that is currently been given to those who rent out rooms in their own homes under the rent-a-room relief scheme, with a view to helping to keep such landlords in the rental system; and if he will make a statement on the matter. [40709/23]

Michael McGrath (Cork South Central, Fianna Fail)
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Decisions regarding tax incentives and reliefs, whether in respect of the introduction of new measures or the amendment of existing measures, are normally made in the context of the annual Budget and Finance Bill process. Such decisions must have regard to the sound management of the public finances and my Department's Tax Expenditure Guidelines. Tax reliefs, no matter how worthwhile in themselves, may serve to narrow the tax base and can make general reform of the tax system that much more difficult. As the Deputy will appreciate, it is a longstanding practice of the Minister for Finance not to comment specifically on any matters that might be the subject of Budget decisions, in advance of the Budget.

It is also important to note that a wide array of tax reliefs and exemptions are already available for landlords and the property sector. The combined cost of these, in tax receipts forgone, is significant. For landlords subject to income tax, the current position is that, after the deduction of allowable expenses, rental income is subject to tax as part of the total taxable income of the landlord. Individual landlords may therefore be subject to income tax at their marginal rate of tax in addition to which USC and PRSI will also apply.

Some examples of deductible expenses currently available to landlords include:

• the cost of maintenance, repairs, insurance and management of the property; property management fees;
• the cost of registering a residential tenancy with the Residential Tenancies Board; the cost of letting, such as letting agency fees; and the cost to the landlord of any goods provided or services rendered to a tenant;
• with effect from 1 January 2019, 100% of the interest on mortgages for residential rental properties may also be deducted;
• wear and tear allowances are available in respect of furniture, fixtures and fittings provided by a landlord. These allowances are granted at the rate of 12.5% per annum over a period of 8 years;
• owners of rental properties are also entitled to claim deductions of up to €10,000 against rental income from that premises for various expenses incurred prior to it being first let after a six-month period of non-occupancy; and
• Finance Act 2022 provided for the deduction of up to €10,000 in certain retrofitting expenses incurred by landlords on rented residential properties where tenants remain in situ.

Michael McGrath (Cork South Central, Fianna Fail)
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I am advised by Revenue that the number of taxpayer units who availed of tax relief on health expenses incurred is included in the ‘Cost of Tax Expenditures’ publication which is available on the Revenue website at

www.revenue.ie/en/corporate/documents/statistics/tax-expenditures/costs-tax-expenditures.pdf

For the Deputy’s convenience, the below table breaks down the number of taxpayer units and cost of health expenses relief for the years 2018 to 2021. It should be noted, that a taxpayer unit can be included in the totals for Health Expenses (excluding nursing homes expenditure) and Health Expenses (including nursing homes expenditure) claimants.

I am further informed by Revenue that health expenses claims that are submitted by taxpayers and their agents form the basis on which the tax relief is provided. Accordingly, there is no available data from which to estimate the quantum of health expenses that would be eligible for tax relief but for which the relief was not claimed.