Taxes Consolidation Act 1997 section 97

Computational rules and allowable deductions

Section 97 sets out how rental income is calculated for tax purposes under Case V of Schedule D, including the expenses that landlords can deduct and the rules governing interest relief on borrowings for residential property.

• Rental profit or loss must be calculated separately for each property by deducting allowable expenses from gross rent, and the overall Case V income is the total of all surpluses reduced by all deficiencies.
• Allowable deductions include rent payable on the property, local rates, costs of services and goods required under the lease, maintenance, repairs, insurance, management costs (excluding capital expenditure), and interest on loans used to buy, improve or repair the property.
• Interest on borrowings for residential property has been fully deductible since 1 January 2019, but is only allowed where the property is registered with the Residential Tenancies Board, and is not available where the property was purchased from a spouse or civil partner (unless separated or divorced).
• Between 2016 and 2019, landlords who rented to qualifying tenants (those in receipt of social housing support or rent supplement) for continuous three-year periods could reclaim the portion of interest previously restricted under the 75%–85% limitation.