Thoughts on inheriting UK house
#1
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Thoughts on inheriting UK house
Just curious what have others done when they have inherited their parents UK home?
I am really torn between renting it out and keeping it in case I ever decide to return to UK.....
Or sell it and invest funds.
I am really torn between renting it out and keeping it in case I ever decide to return to UK.....
Or sell it and invest funds.
#2
Re: Thoughts on inheriting UK house
I'm anticipating a quarter share if my mum doesn't outlive me. Apparently one brother would like to live there (and no doubt mess it up like everything else he touches - I don't mean untidy) but he wouldn't be able to buy us out and I wouldn't want to rent to him as he's not reliable at all.
It would come in handy to add the share of the proceeds to other resources and buy somewhere more manageable in size and running costs for the stepkids when I'm gone.
#3
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Re: Thoughts on inheriting UK house
Thanks Bristol- no siblings just me... I guess I am sentimental - all my life my parents never owned a house because we were a military family and so once my dad came out of the service, this was the first home they bought.
Not sure what living in Canada and bloody cold winters will look like when I am done with travelling south for them, so that's why I was thinking I might hang on to the house...
my only other concern is finding a reputable letting agency and what to do with the contents, should I rent out furnished or not...
Not sure what living in Canada and bloody cold winters will look like when I am done with travelling south for them, so that's why I was thinking I might hang on to the house...
my only other concern is finding a reputable letting agency and what to do with the contents, should I rent out furnished or not...
#4
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Re: Thoughts on inheriting UK house
My 2 cents worth: I always suggest my clients have property in their portfolio, whether that be via funds or directly owned. The income is a nice earner and will increase with the market. If there is no mortgage, you can save for your landlord's insurance, any tax you may have to pay, and any repairs or empty periods. Naturally the good ol' CRA will want to know all about this new asset.
I can recommend a good letting agency if your house is in the Geordie land area. They prepare our tax statement, have been brilliant with tenant finding and great with any repairs that need sorting.
Finally, if you do return to the UK, you will then have a place to go instead of struggling to get a bank to lend to you.
I can recommend a good letting agency if your house is in the Geordie land area. They prepare our tax statement, have been brilliant with tenant finding and great with any repairs that need sorting.
Finally, if you do return to the UK, you will then have a place to go instead of struggling to get a bank to lend to you.
#5
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Re: Thoughts on inheriting UK house
Thanks for the reply- actually it will be near the south coast...in Dorset. So do you pay tax on the rental in the UK? Is landlords insurance much more expensive? What are your thoughts on renting furnished or not? CRA you would report on T1135? Thanks in advance.
My 2 cents worth: I always suggest my clients have property in their portfolio, whether that be via funds or directly owned. The income is a nice earner and will increase with the market. If there is no mortgage, you can save for your landlord's insurance, any tax you may have to pay, and any repairs or empty periods. Naturally the good ol' CRA will want to know all about this new asset.
I can recommend a good letting agency if your house is in the Geordie land area. They prepare our tax statement, have been brilliant with tenant finding and great with any repairs that need sorting.
Finally, if you do return to the UK, you will then have a place to go instead of struggling to get a bank to lend to you.
I can recommend a good letting agency if your house is in the Geordie land area. They prepare our tax statement, have been brilliant with tenant finding and great with any repairs that need sorting.
Finally, if you do return to the UK, you will then have a place to go instead of struggling to get a bank to lend to you.
#6
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Re: Thoughts on inheriting UK house
Our letting agent recommended unfurnished (which did take me aback a little) as, these days, a lot of the younger ones will have furniture. In addition, if it is not listed on your inventory, you are not responsible for replacement or repairs. Mind you, it does mean that the tenants can make off with anything not on the inventory... cheeky wee sods who rented our place made off with the washing machine!!!!
You have to do a tax return in the UK and declare your rental income but, so long as it is under the personal allowance, there is no tax to pay. A straightforward UK tax return is simple to do.
Landlord's insurance is a bit more pricey... I would have to look but I think we are paying 180 quid a year (can't find the proper pound sign on my Canadian keyboard here), whereas on the normal B&C, we were only paying 90 quid.
T1135 is the boyo you need for the CRA.
It sounds like a bit of hassle, doesn't it. The thing is it is only a few hours a year you spend on this, so the question is more about what do you think and what will this choice mean for you.
#7
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Re: Thoughts on inheriting UK house
FWIW ...............
I get £ by holding ALT + 156 on the numeric pad.
I get £ by holding ALT + 156 on the numeric pad.
#8
Joined: Sep 2008
Posts: 12,830
Re: Thoughts on inheriting UK house
Assets on property over $100,000 cost go on a T1135 (In CAD). If it is later sold, any gain in value (in CAD) is subject to CGT in Canada and the UK if you are a non-resident of the UK. UK tax can be offset against Canadian tax liability.
Income, minus reasonable expenses has to be reported in Canada on your T1, whether you pay tax in the UK or not. It is income and the UK tax allowances have nothing to do with Canadian tax reporting. This income gets added to your Canadian income and you are taxed accordingly. The upside is you don't have to file until June 15 with SE income. Interest is charged on tax due from April 30 until paid though. If tax is paid in the UK the taxpayer in Canada can apply for a foreign tax paid credit (with proof of tax paid).
Landlords insurance costs more than homeowners. It is a business policy.the risk is greater to the insurer than owner occupied.
Income, minus reasonable expenses has to be reported in Canada on your T1, whether you pay tax in the UK or not. It is income and the UK tax allowances have nothing to do with Canadian tax reporting. This income gets added to your Canadian income and you are taxed accordingly. The upside is you don't have to file until June 15 with SE income. Interest is charged on tax due from April 30 until paid though. If tax is paid in the UK the taxpayer in Canada can apply for a foreign tax paid credit (with proof of tax paid).
Landlords insurance costs more than homeowners. It is a business policy.the risk is greater to the insurer than owner occupied.
#9
Joined: Sep 2008
Posts: 12,830
Re: Thoughts on inheriting UK house
Canadian tax residents have to report world income on a T1, if ones income exceeds the Canadian personal allowances, there may be tax due in Canada.
#11
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Re: Thoughts on inheriting UK house
Okay thanks for that- understood.
#14
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Re: Thoughts on inheriting UK house
I can only tell you about the experience and advice we have received.
Our letting agent recommended unfurnished (which did take me aback a little) as, these days, a lot of the younger ones will have furniture. In addition, if it is not listed on your inventory, you are not responsible for replacement or repairs. Mind you, it does mean that the tenants can make off with anything not on the inventory... cheeky wee sods who rented our place made off with the washing machine!!!!
You have to do a tax return in the UK and declare your rental income but, so long as it is under the personal allowance, there is no tax to pay. A straightforward UK tax return is simple to do.
Landlord's insurance is a bit more pricey... I would have to look but I think we are paying 180 quid a year (can't find the proper pound sign on my Canadian keyboard here), whereas on the normal B&C, we were only paying 90 quid.
T1135 is the boyo you need for the CRA.
It sounds like a bit of hassle, doesn't it. The thing is it is only a few hours a year you spend on this, so the question is more about what do you think and what will this choice mean for you.
Our letting agent recommended unfurnished (which did take me aback a little) as, these days, a lot of the younger ones will have furniture. In addition, if it is not listed on your inventory, you are not responsible for replacement or repairs. Mind you, it does mean that the tenants can make off with anything not on the inventory... cheeky wee sods who rented our place made off with the washing machine!!!!
You have to do a tax return in the UK and declare your rental income but, so long as it is under the personal allowance, there is no tax to pay. A straightforward UK tax return is simple to do.
Landlord's insurance is a bit more pricey... I would have to look but I think we are paying 180 quid a year (can't find the proper pound sign on my Canadian keyboard here), whereas on the normal B&C, we were only paying 90 quid.
T1135 is the boyo you need for the CRA.
It sounds like a bit of hassle, doesn't it. The thing is it is only a few hours a year you spend on this, so the question is more about what do you think and what will this choice mean for you.