Taxes Consolidation Act 1997 section 372P

Rented residential accommodation: deduction for certain expenditure on construction

Section 372P provides a deduction against rental income for expenditure incurred on the construction of rented residential accommodation in qualifying rural areas under the Rural Renewal Scheme.

• The relief is a "section 23-type" deduction, allowing construction expenditure to be set against rental income from the property.
• The property must be a qualifying premises located in a qualifying rural area, with a floor area of between 38 and 175 square metres, and must be first let under a qualifying lease.
• A qualifying lease must be for at least 3 months, with the rent payable periodically, and any premium must not exceed 10% of the relevant cost of the house.
• The relevant period is 10 years from the date of first letting, during which a clawback applies if the property ceases to qualify or the lessor's interest is transferred.