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Boring tax question

Boring tax question

Old Dec 18th 2003, 4:32 am
  #1  
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Default Boring tax question

I live here - I rent out my house at home (uk).

I am registered as non-resident for tax purposes by the Inland Revenue.

do I pay tax on the profit from my renting at normal rates, ie the first x thousand tax free then 10 then 22% etc, or is there a special rate.

I ask this as I have just thrown in my tax return since being away, and I'm wondering how unpleasant the shock will be.
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Old Dec 18th 2003, 6:31 am
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Default Re: Boring tax question

Originally posted by RichS
I live here - I rent out my house at home (uk).

I am registered as non-resident for tax purposes by the Inland Revenue.

do I pay tax on the profit from my renting at normal rates, ie the first x thousand tax free then 10 then 22% etc, or is there a special rate.

I ask this as I have just thrown in my tax return since being away, and I'm wondering how unpleasant the shock will be.
Are you talking about UK or OZ tax.

UK: I am sure that you will just pay 22% basic rate on the net return. No tax free threshold for non residents.
Check this site:Inland Revenue - Overseas Landlords


OZ: You need to declare it here aswell, OZ Tax
 
Old Dec 18th 2003, 6:44 am
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Default Re: Boring tax question

Originally posted by RichS
I live here - I rent out my house at home (uk).

I am registered as non-resident for tax purposes by the Inland Revenue.

do I pay tax on the profit from my renting at normal rates, ie the first x thousand tax free then 10 then 22% etc, or is there a special rate.

I ask this as I have just thrown in my tax return since being away, and I'm wondering how unpleasant the shock will be.
Me too.

I don't pay tax in the UK on the rental but it is counted as income on my tax return in Oz.

What you need to do if the house is jointly owned is split the income 50% between you and your partner/wife's returns.
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Old Dec 18th 2003, 6:50 am
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If you did pay tax in the UK it would credit the Australian tax due so either way you are paying the higher amount of the 2.
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Old Dec 18th 2003, 11:32 am
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Default Re: Boring tax question

Not so ... citizens of the UK, other EU countries, and other Commonwealth countries are entitled to claim the UK personal allowance, which can be used against your UK source net rental income, even if you are non-UK resident.

Best regards.




Originally posted by ABCDiamond
Are you talking about UK or OZ tax.

UK: I am sure that you will just pay 22% basic rate on the net return. No tax free threshold for non residents.
Check this site:Inland Revenue - Overseas Landlords


OZ: You need to declare it here aswell, OZ Tax
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Old Dec 18th 2003, 9:31 pm
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Default Re: Boring tax question

Originally posted by Alan Collett
Not so ... citizens of the UK, other EU countries, and other Commonwealth countries are entitled to claim the UK personal allowance, which can be used against your UK source net rental income, even if you are non-UK resident.

Best regards.
Surely this doesn't alter the final result, does it? That being that you will end up paying the higher of the two tax regimes? I would have thought that it just means that the ATO gets a bigger cheque?
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Old Dec 19th 2003, 12:37 am
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Rog,

In normal circumstances yes - however I am being a tad slow with the returns, and the period in question this time round relates to a period in time where I was NR in the UK, but domiciled in Singapore. In this case the UK rate is the higher and so really the only one I have a liability for.

when I do the return for the year when I was living here, things will be slightly different as I made a whopping loss on the deal due to some hefty damage and repair jobs I incurred (all of which come in the deductibke bracket ).

Alan - thanks for your reply - I'm assuming you are correct on the grounds that your reply gives me the smallest tax bill.
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Old Dec 19th 2003, 1:04 am
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But are you resident, but not ordinarily resident, ordinarily resident and domiciled, not domiciled but resident or not resident, but ordinarily resident & not domilciled? WTF?!?!?

And people think Oz systems are confusing! LOL
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Old Dec 19th 2003, 4:52 am
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Mrs D - you're dead right. Just try and register for the UK online tax return thing, my word it's a lesson in confusion.

and all this resident/ordinary etc business. what a headache.

at the end of the day my tax return at home is a lesson in guesswork
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Old Dec 19th 2003, 10:02 am
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Default Re: Boring tax question

It can also affect you if you are late in filing your UK Tax Return, as the late filing penalty is the lower of £100 and the tax outstanding at 31st Jan following the end of the tax year.

Best regards.



Originally posted by Rog Williams
Surely this doesn't alter the final result, does it? That being that you will end up paying the higher of the two tax regimes? I would have thought that it just means that the ATO gets a bigger cheque?
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Old Jan 5th 2004, 2:17 pm
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Hi all,

I am also renting out my home in the UK. Any profit I make will easily be swallowed up by the UK tax free allowance.

However, does it mean that I will have to pay Australian tax on the net rental income? I am working in Australia, and so have used up the $6,000 tax free allowance here.

Cheers,

Mike
 
Old Jan 5th 2004, 2:26 pm
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Yes, you most probably will ...

Note that you may have different (additional) deductions available when computing your net rental income in Australia as compared with the UK. I would liaise with an accountant in Australia in this regard.

Best regards.



Originally posted by ozduffs
Hi all,

I am also renting out my home in the UK. Any profit I make will easily be swallowed up by the UK tax free allowance.

However, does it mean that I will have to pay Australian tax on the net rental income? I am working in Australia, and so have used up the $6,000 tax free allowance here.

Cheers,

Mike
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Old Jan 5th 2004, 2:36 pm
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I'll do that.

Thanks very much Alan.

Cheers,


Mike
 
Old Jan 6th 2004, 12:00 am
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Originally posted by ozduffs
Hi all,

I am also renting out my home in the UK. Any profit I make will easily be swallowed up by the UK tax free allowance.

However, does it mean that I will have to pay Australian tax on the net rental income? I am working in Australia, and so have used up the $6,000 tax free allowance here.

Cheers,

Mike
If the money is not brought into Australia, will it still be taxed here?

eg: The money stays in a UK bank account, and goes to pay the UK credit card bills, which just happen to be incurred in OZ ?
 
Old Jan 6th 2004, 12:05 am
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Originally posted by ABCDiamond
If the money is not brought into Australia, will it still be taxed here?

eg: The money stays in a UK bank account, and goes to pay the UK credit card bills, which just happen to be incurred in OZ ?
If you are resident in Australia for taxation purposes then yes.
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