Where an individual lets a room (or rooms) in his or her sole or main residence as residential accommodation, the income may be exempt from income tax where the aggregate of the gross rents and any sums for meals or other services supplied in connection with the letting is below a certain threshold (€10,000 for the tax years 2013 & 2014 under the Rent a Room relief).
The exemption does not affect any entitlement to mortgage interest relief or to Capital Gains Tax exemption on the disposal of the residence.
The exemption is not due where the payments are to a parent from his or her child. Neither is it due where the payments are to an individual who is an office holder or an employee of the person making the payments or, of a person who is connected with the person making the payments or to a person connected with the office holder or employee.
For more information see Leaflet IT 70 - A Revenue Guide to Rental Income