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The attention of Practitioners is drawn to the provisions of Sections 200 and 433 of the Income Tax Act 1967.

Section 433 imposes on a person, collecting rents on behalf of non-resident landlords, a statutory obligation to deduct tax at the standard rate and forward same to the Revenue. Such person is deemed to be an agent of the non-resident Landlord and as such is personally liable for tax on said rental income at the standard rate.

The non-resident Landlord's agent must deduct the tax from the rental income received and forward the monies, so deducted, to Revenue. The agent must then furnish to the non-resident landlord a form RI85 showing the total rental collected and the amount deducted in accordance with the provisions of the Section. The non-resident Landlord must lodge the form RI85 together with any claim for refund to the Claims Section, in Dublin.

Practitioners are therefore strongly urged that when they receive instructions to prepare letting agreements on behalf of non-resident clients, they should notify the client in writing of these statutory provisions and should seek a written acknowledgement of receipt of such letter.

Failure on the part of Practitioners to advise their

1.  
   1. tenant clients; or
   2. non-resident Landlord clients; or
   3. rent-collection clients (e.g. estate agents)

of this provision could result in that client having a cause of action against the practitioner under Section 200 of the Income Tax Act, 1967. A Solicitor or other party, who receives money on behalf of a non-resident client by way of proceeds of a sale or other source to which the client is entitled, may be deemed to be the agent of such non-resident client and may be accordingly personally liable for any tax liability due in respect of said monies and possibly for other tax liabilities of the principal. Practitioners are therefore strongly urged not to release such monies without first obtaining a letter of clearance from the Inspector of Taxes.