Property Data

Publication by the Global Property Guide research team.

Rental income taxes

December 13, 2011

How can I compare rental income tax rates across countries?

Navigate to a country or continent and select Rental Income Tax from the Regional Stats menu.

What assumptions are made in presenting the Global Property Guide’s ‘typical case’ income tax scenario?

To arrive at the tax payable, we assume gross rental income is:

  • €/US$1,500/month, or
  • €/US$6,000/month, or
  • €/US$12,000/month (in cross-continent comparisons we assume €/US$1,500/month)

  • The property is personally directly owned jointly by husband and wife
  • Both owners are foreigners and non-residents
  • They have no other local income
  • There is no mortgage, i.e., no loan is taken for the purchase

In arriving at the pre-tax profit figure, we calculate, and deduct:

  • Depreciation / capital allowances – if available. We assume a typical value for the apartment, based on our valuation research, and depreciate on this basis

We deduct any other typical costs which a landlord pays, management charges, buildings insurance, realtor agency fees, etc. W e either choose a standard percentage deduction (if available) or typical ‘actually incurred’ costs. If real estate tax is normally payable by the landlord, we deduct that.

We use the term 'income tax' in a broad sense, as “any tax levied, proportionately to the amount of income received by the owner for letting property”. Thus VAT on renting property would be considered a "(broad definition) income tax", but municipal taxes payable by all home-owners whether renting or not, would not be considered 'income tax'.

We adopt this (somewhat unusual) definition because it represents reality. Landlords often have to pay taxes on income which are not called income tax, but which are in fact proportional to their income. All these are counted by us as ‘taxes on income’.

What are the sources of the Global Property Guide’s income tax data? Can these sources be trusted?

Rental income tax figures are, in every case, based on computations provided by accountants commissioned by us. See also a complete list of contributing firms here.

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