Taxes Consolidation Act 1997 section 372AG

Section 372AG provides a deduction against rental income for expenditure incurred on the refurbishment of rented residential accommodation in designated qualifying areas.

• A lessor who incurs relevant expenditure on refurbishing a qualifying premises in a qualifying area is entitled to deduct that expenditure against the rent received from the premises.
• The premises must be a house used solely as a dwelling, with a total floor area of between 38 and 150 square metres, and let under a qualifying lease for a relevant period of 10 years.
• Premiums payable under the qualifying lease are restricted to 10 per cent of the market value of the house, and excess premiums reduce the relief available.
• A clawback applies where the premises ceases to be a qualifying premises within the 10-year relevant period, and special rules govern purchasers of refurbished houses.