New Taxation Rules for Short-Term Rental Properties Announced in Ireland
In a bid to streamline the taxation system and boost revenue, the Irish government has announced amendments to the rules for the taxation of short-term rental properties. These changes include revised VAT rules and extensions of reduced VAT rates for various supplies. The amendments will come into effect on January 1, 2024.
Under the revised VAT rules, short-term rentals will be subject to VAT at a reduced rate of 13% if the lessor is a legal entity or a natural person who owns at least three short-term rental properties. However, natural persons with up to two rental properties will not be within the scope of VAT. This change aims to ensure that larger rental property owners contribute their fair share of taxes while providing relief for smaller property owners.
In addition to the revised VAT rules, the government has also extended the reduced VAT rates for various supplies. These extensions include a permanent extension of the 0% VAT rate for COVID-19 vaccines, which is crucial in the ongoing fight against the pandemic. The super reduced VAT rate of 6% for certain dialysis equipment has also been made permanent, ensuring affordability and accessibility for patients in need.
Furthermore, the reduced VAT rate of 13% for coffee, cocoa, tea, chamomile, and other infusions has been extended until June 30, 2024. This extension will benefit consumers who enjoy these beverages on a regular basis. Importantly, the reduced VAT rate of 13% for imports of art objects, collections, or antiques, as well as the delivery of objects of artistic value, has also been made permanent. This move aims to support the art industry and encourage the importation and sale of valuable cultural artifacts.
The government has also recognized the importance of public health and safety by extending the super reduced VAT rate of 6% for defibrillators. This extension will ensure that these life-saving devices remain affordable and accessible to the general public. Additionally, the reduced VAT rate of 13% for the transport of persons and their luggage carried out by public passenger vehicles, such as taxis, has been extended until June 30, 2024. This extension will benefit both passengers and taxi drivers, providing stability and predictability in the pricing of these services.
In a move to support the cultural sector, the government has made permanent extensions to the reduced VAT rates for zoo tickets and cinema tickets. These measures aim to encourage the public to visit zoos and cinemas, supporting these industries that have been severely impacted by the COVID-19 pandemic. Additionally, the reduced VAT rate of 13% for the provision of services by gyms and dance schools has also been made permanent. This extension will help these establishments recover from the financial losses incurred during the pandemic and encourage people to prioritize their health and well-being.
Overall, these amendments to the taxation rules for short-term rental properties and the extension of reduced VAT rates for various supplies demonstrate the Irish government’s commitment to creating a fair and efficient tax system. By ensuring that larger rental property owners contribute their fair share of taxes and providing relief for smaller property owners, the government aims to promote a level playing field in the rental market. The extensions of reduced VAT rates for essential supplies and cultural experiences also reflect the government’s efforts to support public health, safety, and the arts. These changes will come into effect on January 1, 2024, and are expected to have a positive impact on both taxpayers and the economy as a whole.
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