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Oz Tax Return - UK Property?

Oz Tax Return - UK Property?

Old Jul 2nd 2010, 12:18 pm
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Default Oz Tax Return - UK Property?

I have property in the UK on which I'm making a loss, I have to pay about £100 a month towards all of the costs involved, as the rent the tenants are paying doesn't cover it all. Someone suggested that this means I could offset this loss against my Australian tax or something, can someone advise me if this is the case as when I mentioned it to our accountant the other day he didn't really seem to know!? If it IS the case could someone provide me with a link which I can then show him? lol Thanks folks
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Old Jul 2nd 2010, 12:21 pm
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Default Re: Oz Tax Return - UK Property?

Originally Posted by Jen1977ni View Post
I have property in the UK on which I'm making a loss, I have to pay about £100 a month towards all of the costs involved, as the rent the tenants are paying doesn't cover it all. Someone suggested that this means I could offset this loss against my Australian tax or something, can someone advise me if this is the case as when I mentioned it to our accountant the other day he didn't really seem to know!? If it IS the case could someone provide me with a link which I can then show him? lol Thanks folks
I would assume you could claim all expenses (except component of mortgage that reduces capital component) but would just be guessing - but are you sure you would not be better asking for links to a new accountant ...at least one that says: I'll find out for you.

Last edited by fish.01; Jul 2nd 2010 at 12:25 pm.
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Old Jul 2nd 2010, 12:24 pm
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Default Re: Oz Tax Return - UK Property?

Originally Posted by fish.01 View Post
I would assume you could claim it but would just be guessing - but are you sure you would not be better asking for links to a new accountant ...at least one that says: I'll find out for you.
HAHA no this one comes highly recommended amongst our 'field' of client, we're ADF Lateral Transfers and he deals a lot with 'people like us' lol
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Old Jul 2nd 2010, 12:26 pm
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Default Re: Oz Tax Return - UK Property?

Originally Posted by Jen1977ni View Post
HAHA no this one comes highly recommended amongst our 'field' of client, we're ADF Lateral Transfers and he deals a lot with 'people like us' lol
By "deals with" do you mean shrugs his shoulders and says "pffttt"
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Old Jul 2nd 2010, 1:44 pm
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Default Re: Oz Tax Return - UK Property?

Originally Posted by Jen1977ni View Post
HAHA no this one comes highly recommended amongst our 'field' of client, we're ADF Lateral Transfers and he deals a lot with 'people like us' lol
Hi jen. Jen if you make an income of your place you can sign a form which makes you exempt from paying tax as long as you dont earn something over 5k a year roughly, although some smart arse wil come up from here with the exact amounts. Dont worry about it.
You need if staying long tern over here, if you wil be affected by the new capital gains tax. I hope you are good pal.
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Old Jul 2nd 2010, 11:40 pm
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Default Re: Oz Tax Return - UK Property?

Originally Posted by mark wool View Post
Hi jen. Jen if you make an income of your place you can sign a form which makes you exempt from paying tax as long as you dont earn something over 5k a year roughly, although some smart arse wil come up from here with the exact amounts. Dont worry about it.
You need if staying long tern over here, if you wil be affected by the new capital gains tax. I hope you are good pal.
I dont make a penny, I'm around £100 out of pocket every month, so...

I'm good ta, how r u both?
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Old Jul 3rd 2010, 7:33 am
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Default Re: Oz Tax Return - UK Property?

Originally Posted by Jen1977ni View Post
I have property in the UK on which I'm making a loss, I have to pay about £100 a month towards all of the costs involved, as the rent the tenants are paying doesn't cover it all. Someone suggested that this means I could offset this loss against my Australian tax or something
Yes, that's all correct.

In your Australian tax return, you declare the gross UK rental income - and all the UK expenses, e.g. interest on mortgage (but interest element only not the capital element of the repayments), fees you pay the rental agent who looks after the property, costs of repairs, and any other expenses you have [all calculated from the date you arrived in Australia].

If you make a loss, then that reduces your other income.

For example, imagine you earned $50,000, you had no deductions against that, and you have a $10,000 loss from your UK property - then your taxable income would be $40,000.
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Old Jul 3rd 2010, 8:48 am
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Default Re: Oz Tax Return - UK Property?

I am in the process of letting my property at the mo. I am on an interest only mortgage of £495 a month with rental income of £675. Less fees and insurance - approx £125 this leaves me with £55 a month profit. Would the £55 be the only taxable part due to my mortgage being interest only?
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Old Jul 3rd 2010, 10:01 am
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Default Re: Oz Tax Return - UK Property?

Originally Posted by MaCCCa View Post
I am in the process of letting my property at the mo. I am on an interest only mortgage of £495 a month with rental income of £675. Less fees and insurance - approx £125 this leaves me with £55 a month profit. Would the £55 be the only taxable part due to my mortgage being interest only?
Not sure:


My rental income - £425
_____________________________
My mortgage: £417 - interest only
Rates: £68
Landlord's insurance: £13
Scottish Provident Critical Illness cover £29
Agent's fee is about 6% - can't rem how much exactly as I paid him 6 months in advance.

So....I make nuffinks out of this venture lol
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Old Jul 3rd 2010, 10:48 am
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Default Re: Oz Tax Return - UK Property?

Is your critical Illness cover for just you or you and your partner? We have an advisor popping round next week to try and reduce our current life ins to keep costs down.

Also whats the 'Rates' that you pay - that council tax?
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Old Jul 3rd 2010, 10:49 am
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Default Re: Oz Tax Return - UK Property?

Originally Posted by MaCCCa View Post
Is your critical Illness cover for just you or you and your partner? We have an advisor popping round next week to try and reduce our current life ins to keep costs down.

Also whats the 'Rates' that you pay - that council tax?
Just me, I bought the house before I met him...I die, the house is paid for, and it's left to him anyways, so everyones a winner lol
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Old Jul 3rd 2010, 10:50 am
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Default Re: Oz Tax Return - UK Property?

Originally Posted by MaCCCa View Post
I am in the process of letting my property at the mo. I am on an interest only mortgage of £495 a month with rental income of £675. Less fees and insurance - approx £125 this leaves me with £55 a month profit. Would the £55 be the only taxable part due to my mortgage being interest only?
Yes. But in your OZ tax return, you don't just show the GPB55 a month. You put in ALL the figures (converted into Australian dollars).
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Old Jul 3rd 2010, 10:59 am
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Default Re: Oz Tax Return - UK Property?

Originally Posted by ozhappy981 View Post
Yes. But in your OZ tax return, you don't just show the GPB55 a month. You put in ALL the figures (converted into Australian dollars).
Ok thats cool thankyou! Guess that £55 will be spent on Life insurance then! Ahh well I'll break even - beats leaving the house emtpy!
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Old Jul 3rd 2010, 11:06 am
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Default Re: Oz Tax Return - UK Property?

Originally Posted by ozhappy981 View Post
Yes. But in your OZ tax return, you don't just show the GPB55 a month. You put in ALL the figures (converted into Australian dollars).
Our accountant has said that my property in the UK doesn't need to be taken into account on my Oz tax return, I'm almost sure it does and want something concrete to show him....I wont see him again til August as the OH is away with work til then....
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Old Jul 3rd 2010, 11:49 am
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Default Re: Oz Tax Return - UK Property?

Originally Posted by Jen1977ni View Post
Our accountant has said that my property in the UK doesn't need to be taken into account on my Oz tax return, I'm almost sure it does and want something concrete to show him....I wont see him again til August as the OH is away with work til then....
Hi,

This is the link to the relevant ATO website page. It should give you something concrete for your accountant. Per other posters though, if you have to advise your accountant....I'd be looking for a new one!

http://www.ato.gov.au/individuals/co....htm&page=5&H5
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