Landlord? Self employed? Got deposits abroad? Tips to save money this tax year

The paper deadline for tax returns may have passed on Halloween, but those who need to file a Form 11 can still do so until November 18th.This later deadline undoubtedly applies to most people – according to Revenue, 98 per cent of Form 11s were filed electronically last year, for the 2024 tax year.But if you’re a landlord, director, have €5,000 or more in taxable non-PAYE income, or are self-employed and have yet to file, what do you need to know about this year’s returns? And most importantly perhaps, will you pay less tax this time around?Will my tax bill fall?A number of tax changes were made for 2025, which means that if you’re paying tax for this year now, your total bill should decline, all other things being equal.READ MOREThe biggest gain is probably among those earning more than €42,000 (for a single person), thanks to a €2,000 increase in the standard rate band. This means a reduction in tax of about €400 a year.And there was also an increase, of €125, in the earned income tax credit for the self-employed, which increased to €2,000, as well as changes to the universal social charge (USC), where the 4 per cent rate will fall back to 3 per cent, and will apply on earnings of €27,382 to €70,044.For example, based on figures from PwC, a dual income family earning €175,000 would have had a net monthly income of €9,146 in 2024, but €9,245 in 2025, so savings of €99 a month or €1,188 a year.One tax that did go up, however, was PRSI; last year it increased by 0.1 per cent. And looking ahead, PRSI increased again this October, by 0.15 per cent. If you’re renting or own a home“Check the mortgage interest tax credit and the rent tax credit, as both are often missed,” says Kinga Guzikowska, of KPG Accounting Services.It may be due to come to an end this year – no extension was granted in last month’s budget – but those filing for 2025 might still qualify for the mortgage interest tax credit.[ State manual to support ‘Stoneybatter-style’ housing as alternative to apartments unfinishedOpens in new window ]To do so, you will need to have had an outstanding mortgage balance of between €80,000 and €500,000 as of end-2022 and, crucially, you must have paid more in interest on your loan in 2025 than you did in 2022.It’s unlikely to change the dial on your return, however; the relief is capped at 20 per cent of the increase, up to a maximum of €1,250. As an example, a €3,000 increase would give a tax saving of €300.For renters, the rent tax credit increased to €1,000 for a single person (€2,000 for a couple) for 2025, and can make a meaningful impact on your tax bill, so if you’re liable for it, make sure you file for it. Remember, if you’re paying for your child’s digs or student room, the credit also applies. Latest figures for 2024 show that more than 335,000 taxpayers claimed the relief that year.If you’re a landlordIf you rented out a property in 2025, you will pay slightly less tax this year than you might have done previously, due to the increase in the Residential Premises Rental Income Relief.First introduced in 2024, the relief is offered at a rate of 20 per cent of the landlord’s rental income. For 2025 tax returns, the limit will increase from €3,000 to €4,000. Not only that, but as the limit will increase to €5,000 for the 2026 tax year, you can also get a reduction on your preliminary tax for that year.[ Two-thirds of workers fear their pension won’t be big enough to fund their retirementOpens in new window ]It means that the maximum credit will increase from €600 for 2024 to €800 in 2025 – and €1,000 for 2026 and 2027. “It is a help, I’m not denying the help, but it’s not sufficient to resolve the exodus of landlords, if that’s what the Government is trying to do,” says Brendan Allen, a tax adviser with Landlord.ie.While regulation might be the bigger issue for landlords at the moment, following on from changes introduced on March 1st, tax is still presenting some challenges.“I’d like to see landlords being treated as a genuine business. You cannot get tax relief for pensions, and that’s a huge issue,” says Allen, who describes the decision to allow tax-free rentals on sheds in gardens as a “total and utter fiasco”, given that a landlord letting out a home next door to such a shed will pay tax at the full rate.“It’s about justice and fairness as a principle in taxation,” he says. Overall, he would like “more clarity” for people when filing returns. “It’s now so complex,” he says “there are so many little nuances that you need to be mindful of at all times.”Indeed, there are 935 sections on a paper Form 11. And are they all relevant? “No, they’re not, most will not apply to most people,” says Allen.Another challenge is what expenses are allowed for landlords, with Allen noting that eligible expenses must be directly related to your property.“Travel expenses [for an inspection, for example] are allowed but only at the exact cost of the travel – you’re not allowed claim civil servant rates,” he says. “There is a lot of injustice in the tax situation.” Allen’s other “big bugbear” is that the local property tax (LPT) is not an allowable deduction. “It seems so unfair,” he says.[ How do I work out Revenue taxation of my retirement ARF when its value changes all the time?Opens in new window ]If you’re selling up, remember you will pay less tax on any gains thanks to a reduction in the rate of capital gains tax (CGT) from 33 to 31 per cent. So then, a gain of €300,000 that’s liable to CGT will mean a tax bill of €91,730 this year, instead of €97,730 (after the CGT exemption).If you have deposits abroadThis is something likely to affect more people given the increase in the use of platforms such as Raisin to access better deposit rates across Europe. According to Revenue, 1,300 taxpayer units declared some €2.5 million in interest in 2020, but for 2024, this had jumped to 5,190 taxpayer units, declaring some €45 million.Unlike savings with an Irish bank, Dirt, at a current rate of 33 per cent, is not automatically deducted from interest earned on such accounts.Revenue requires Irish residents to declare interest earned on such deposits on your Form 11, and pay what is owed. If you’re late, you will pay a higher rate.“The income will be subject to a higher rate of 40 per cent tax if it is not returned on time,” Revenue says.Typically, if you hold deposits in countries such as France, the Netherlands and Sweden, you will have to pay the tax yourself. But you may find that you have already paid such tax in your deposit holder’s host country – for example in countries like Italy and Portugal. If so, you can offset what you have paid against your Irish liability.If you can’t afford a payment nowIf you can’t afford to settle your 2025 tax bill this month, it is still important to take action.“File on time even if you can’t pay in full. A phased payment arrangement (PPA) with Revenue costs far less than a late filing surcharge,” says Guzikowska.A surcharge of 5 per cent of your tax due, up to a maximum of €12,695, will apply if you don’t pay up within two months of the deadline, rising to 10 per cent of tax due (up to €63,485) if you go past this date.Interest charges may also apply, including on any shortfall in preliminary tax, at 0.0219 per cent a day (about 8 per cent a year) until it is paid.Instead, you can apply for a PPA through ros.ie, and this will allow you to repay your tax debts in instalments over a period of time, typically up to 36 months. Interest is charged at a rate of between 8-10 per cent, and you will also need to make a down payment on the late payment.Also, make sure your LPT is up to date, or you could face another surcharge, of 10 per cent.