The Revenue Commissioners are currently contacting Non-Resident Landlords with regard to the new Non-Resident Landlord Withholding Tax (NLWT) System that is being introduced with effect from 1 July 2023.
A Non-Resident Landlord is subject to Income Tax on the net income received from letting property or land and are required to submit an Income Tax Return to the Irish Revenue.
The new system being introduced with effect from 1 July 2023 provides for the following:
- Collection Agents appointed deduct Withholding Tax at the 20% rate from the rents and remit the relevant amount to the Revenue Commissioners via the new Withholding Tax platform
- Where Tenants pay rents directly to a Non-Resident landlord, they will be required to withhold and remit tax at 20% via the new Withholding Tax platform.
- The Non-Resident Landlord is required to file their own Income Tax Return - The Collection Agent is no longer responsible for submitting a return on behalf of the non-resident individual.
Any tax withheld will be available as a credit on submission of your annual Income Tax Return.
In order to comply with the legislation, a non-resident landlord should either notify their tenant of the obligation to withhold tax or where a Collection Agent has been appointed, being Estate Agent, Solicitor, Accountant or Family Member or Precedent partner in the case of a Partnership, they should arrange for the Collection Agent to Withhold Tax on your behalf.
A Non-Resident Landlord will also be required to confirm that your non-resident status, your tax reference number and the LPT Property ID to your Collection Agent / Tenants to ensure that all payments can be allocated correctly via the on-line system being introduced from 1 July 2023.
The Revenue Commissioners are currently updating the website and Tax & Duty Manual in relation to the new system and further information should be available in the coming months.
If you require any further information in relation to the above, please do not hesitate to contact Lucy Jo McHugh, Tax Manager on (090) 6480600.