In 2026, the Fair Deal Scheme will turn 16. Over the years, the scheme has evolved significantly, and this year started with the most important update that came into effect—the Rental Income Exemption for homeowners.

For some families, the exemption has been particularly welcome because it improves access to liquidity at a time when cash flow matters most. However, experts like Tom Murray point out that the reform does not remove tax obligations, eliminate landlord responsibilities, or reduce the financial risks associated with renting a home where the owner doesn't live---since they are at the nursing home.

Tim Murray is an independent Fair Deal Scheme consultant in Ireland and the founder of Fair Deal Advice. He has helped over 500 families with financial and estate planning solutions. Tom frequently appears in news articles and radio shows, sharing valuable insights for future and existing applicants. His views on the rental income exemption appeared on the front page of the Independent, and that changed many perceptions.

Understanding the Fair Deal Scheme Rental Income Exemption

Rental income generated from a vacant principal income is no longer tied to the 80% cash asset calculation, giving the Fair The Deal Scheme users a good chance to offset nursing home costs.
However, Tom Murray indicated in his previous publications that:

"The rental income exemption appears more straightforward on paper. It can also push homeowners into becoming 'accidental landlords'."

So why did Tom say that? The answer is an eye-opener:

"Homeowners must register the tenancy with the Residential Tenancies Board (RTB). Families would have to shape into the landlord life with regulations, property management, maintenance, and much more to account for. You just can’t sign a rental agreement and get on with life."

The Residential Tenancies Board oversees landlord compliance in Ireland, and with compliance comes responsibility. From deposit protection and tenancy registration to property standards and dispute resolution, renting a home is not a passive income stream — it is an operational commitment.

Why Timing is a Big Deal

Tim Murray explains that what many families overlook is the timing. The decision to rent often arises during a period of emotional transition — when a loved one has just moved into long-term care under the Fair Deal Scheme. Financial pressure is real. Liquidity matters. But so does clarity.

"Families are already navigating care decisions, financial assessments, and future estate considerations. Adding landlord duties into the mix can complicate matters further," Murray says.

He also highlights an important strategic distinction: liquidity does not automatically equal long-term advantage. Rental income may improve monthly cash flow, but:

- Vacancies can interrupt income.
- Maintenance costs can erode margins
- Insurance premiums may rise
- Tax liabilities can impact your financial plans
- Property values fluctuate
- And tenancy disputes can arise

In short, the exemption changes how rental income is assessed — it does not eliminate the commercial realities of letting property.

Renting a Property—How Hard Could it Be?

Tim Murray’s message is not to discourage renting. Rather, it is to encourage deliberate decision-making.

"The Rental Income Exemption is a powerful tool — when used correctly. But it must fit within a broader financial plan. It should never be a panic reaction."

As the Fair Deal Scheme matures into the future, reforms like the Rental Income Exemption demonstrate a system continuing to evolve. Yet with every new opportunity comes a new responsibility. For families considering the move from homeowner to landlord, expert guidance may be the difference between relief and regret.

Fair Deal Advice continues to work with families across Ireland to ensure that every decision — whether to rent, retain, or sell — is informed, compliant, and aligned with long-term financial goals.

Website- https://fairdealadvice.ie/
Phone- 086 601 5042
Email- [email protected]