Property Taxes - From AU to UK
Oct 11th 2022, 2:47 pm
#1
Just Joined
Thread Starter
Joined: Oct 2022
Posts: 20
Property Taxes - From AU to UK
Hi All,
bit of a complex one - I own property in AU,
currently live in UK
BUT , come april, Mortgage relief is fully removed...
who's in a similar situation RE tax? -
simplistically, it looks like i'll be paying 40% of the rental income in tax (which puts me 35% in the red against the mortgage)...
bit of a complex one - I own property in AU,
currently live in UK
BUT , come april, Mortgage relief is fully removed...
who's in a similar situation RE tax? -
simplistically, it looks like i'll be paying 40% of the rental income in tax (which puts me 35% in the red against the mortgage)...
Oct 11th 2022, 3:04 pm
#2
Migration Agent
Joined: May 2002
Location: Offices in Melbourne, Brisbane, Perth, Geelong (Australia), and Southampton (UK)
Posts: 6,459
Re: Property Taxes - From AU to UK
Given the net rental income in Australia is likely to be taxed at non resident rates (no tax free threshold and first $ of rental income taxed at 32.5%) is the change in the deductibility of mortgage interest in the UK a material issue?
Remember also that in the UK you can claim a tax credit for the amount of the mortgage interest x 20%.
Agreed that in the UK tax relief at 40% or 45% on mortgage interest is no longer available.
Best regards.
Remember also that in the UK you can claim a tax credit for the amount of the mortgage interest x 20%.
Agreed that in the UK tax relief at 40% or 45% on mortgage interest is no longer available.
Best regards.
Oct 11th 2022, 3:21 pm
#3
Just Joined
Thread Starter
Joined: Oct 2022
Posts: 20
Re: Property Taxes - From AU to UK
THANKYOU for your reply...
it won't be taxed in AU as it's less than the AU threshold anyway
from what I can make out t's being directly assesed as UK income it seems
i.e. if we have $10,000 AUD in rental income,
deduct $1k of management fees etc
pay 40% on the remaining $9K, so $3,600 directly to UK gov... (or 25% for lower tax bracket earners
But, there seems to be some oddities as to exactly what can be deducted!
it won't be taxed in AU as it's less than the AU threshold anyway
from what I can make out t's being directly assesed as UK income it seems
i.e. if we have $10,000 AUD in rental income,
deduct $1k of management fees etc
pay 40% on the remaining $9K, so $3,600 directly to UK gov... (or 25% for lower tax bracket earners
But, there seems to be some oddities as to exactly what can be deducted!
Oct 11th 2022, 3:39 pm
#4
Migration Agent
Joined: May 2002
Location: Offices in Melbourne, Brisbane, Perth, Geelong (Australia), and Southampton (UK)
Posts: 6,459
Re: Property Taxes - From AU to UK
THANKYOU for your reply...
it won't be taxed in AU as it's less than the AU threshold anyway
from what I can make out t's being directly assesed as UK income it seems
i.e. if we have $10,000 AUD in rental income,
deduct $1k of management fees etc
pay 40% on the remaining $9K, so $3,600 directly to UK gov... (or 25% for lower tax bracket earners
But, there seems to be some oddities as to exactly what can be deducted!
it won't be taxed in AU as it's less than the AU threshold anyway
from what I can make out t's being directly assesed as UK income it seems
i.e. if we have $10,000 AUD in rental income,
deduct $1k of management fees etc
pay 40% on the remaining $9K, so $3,600 directly to UK gov... (or 25% for lower tax bracket earners
But, there seems to be some oddities as to exactly what can be deducted!
You claim a foreign tax credit on your UK tax return for the tax paid to the ATO.
Best regards.
