escapedtonz

The reciprocal agreement between the UK and NZ is for 4 years and in those 4 years a person is not obligated to declare any UK income in NZ or vice versa.
If you leave UK, still have an income (eg from rental property) you will be required to complete a UK annual tax return which can be done online if you register for it. It is questionable whether a person who is now not ordinarily resident in the UK can claim the tax free personal allowance so you may have to pay tax on all your earnings in the UK ?
For some reason we got away without paying any tax for the whole 4 years - no tax on rental income through the property manager, no income tax on the rental income after tax return completed and no capital gains tax on the sale....possibly because we had no gain?
There's a few things you can write off as expenses in the calculation of the rental income like repairs, maintenance, landlords insurance fees and other schemes like maybe emergency cover for plumbing / appliances etc and even interest payments on a mortgage on the property so maybe we didn't earn anything in the eyes of HMRC through the calculation....we actually got £20 or so each back!!!
Still filling in a tax return each year but hoping the last one will be the final one as we stated no more income in the UK from October 2015.

kakapo

Just to clarify, although we had registered for online tax returns, as non-resident landlords we were not able to use it. Perhaps your situation was different but this was certainly the case for us.

benhila

Kakapo is right; we were registered for online tax returns, but (just like Kakapo) had to submit a hard-copy tax return every year. On the bright side, the form for rental income is very straightforward; you do get the personal allowance which (if the house is in joint ownership) amounts to about £22,000 per annum. From our own experience, keeping your UK property ensures that if you have a change of heart, you have somewhere to return to. We've been away (in NZ and Australia) for over 8 years. If we didn't keep our London flat, it would have been very difficult to start climbing the property ladder again.

patpending

Hi benhila, thanks for sharing your experience. If you have been out of the uk for 8 years does than mean you are exempt from capital gains if you chose to sell? (I assume you would have seen good growth in your flat).

I did speak to HMRC who said we have an 18month window after we have left to sell the house without drawing a capital gain as it is our main residence...at least that is how I understood it!?

benhila

Hi patpending, it looks like the rules have changed over the years we've been away. I found a link that may prove helpful http://www.telegraph.co.uk/tax/capit...o-pay-capital/

Stuck in Auckland

I heard that there has been a change in tax law whereby mortgage interest will no longer be a deductible expense.

This would make a number of properties suddenly very high taxable income status.

MovALot

We are similar to this poster, been out of the UK for 7 years, have residency in Australia, have paid tax on my UK property in Australia also (Global income is what they want to tax you on if you are resident for tax purposes). Always submitted an online tax form to HRMC, always quoted I pay tax in Oz, even after having the all the correct forms submitted previous regarding the double taxation rules. My advice is keep your house, submit your tax forms online with HMRC and ensure you don't play one of the other. Good Luck.

I arrive next month to NZ....look forward to filling in more forms again soon.

Stuck in Auckland

The rental prices are dampening in Clevedon this week

El_queenio

Keep your house in the UK for the time being. We have been here for 2 months and are renting our uk house out, it is on a guaranteed rent scheme too so piece of mind. Rent when you get here for the first 12 months/2 years till you know where you will settle and what the neighbourhoods are like. Imagine you sold your uk house , bought one in NZ but ended up hating NZ and left after 12 months. You'd be homeless! Well worth renting especially if you can make such a big profit on rental/mortgage repayment.