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Tax-free threshold for rent-a-room relief should be increased to encourage its take-up – Higgins

13th November 2022 - Emer Higgins, TD

The tax-free threshold for the rent-a-room relief scheme should be increased to encourage more property owners to avail of it, according to Fine Gael TD Emer Higgins.

Deputy Higgins, a member of the Oireachtas Housing Committee, said: “The rent-a-room relief has two primary advantages; it helps homeowners to make additional income and it also increases the availability of rooms and the supply of accommodation.

“You can earn up to €14,000 per calendar year, completely tax free, which equates to income of up to €1,166.66 per month under the scheme over a 12 month period. If it were to be increased to €18,000 per year, this would bring the income figure to up €1,500 per month.

“In 2018 according to the most recent figures available, some 9,240 people availed of Rent-a-Room relief at a cost of €19.7m to the Exchequer, which amounted to an average tax saving per participant of some €2,100.

“At a time when we are facing acute pressure in the rental accommodation sector, it makes perfect sense for property owners to consider renting out a spare room to those in need of accommodation.

“It could also apply to older people whose children have left home and they may wish to boost their income in retirement, or first-time homeowners with larger mortgages who could do with the help from such a measure.

“To qualify for rent-a-room relief, the room or rooms being let must form part of the residence occupied by the individual receiving the rent as her/ his sole or main residence during the tax year. A self-contained unit, such as a basement flat or a converted garage attached to the person’s home, can qualify for this relief.

“If the property owner rents out a room to a student, the Department of Further and Higher Education has confirmed this will not impact on eligibility for the student grant.

“I believe the Government should carry out a high-profile communications campaigning encouraging people to rent out a room in their homes with information on the relief scheme and how they can claim it.

“Further information can be found at,” Deputy Higgins concluded.


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