tramway

Thanks Bermudashorts, so think i have it now (we are permanent residents):

We HAVE to do returns for both countries
So on UK return we have to pay tax on anything left over after taking Tax FA, mrtg int, hse expenses into account??

So do we fair better overall paying the tax on hse in UK as we thought we would get hit with a huge bill here because of it on our Oz return?
How do we know about the tax legislation dictation?

See whats confusing us is that we thought we only had to do a return here and pay tax on our global income which doesn't appear to be the case??
Sorry for my dumbness

Mrs Jackaroo

We've been in Australia for over 5 years now and have been renting our UK house out the entire time. We've left it in the capable hands of a trusted Agent and I can quite honestly say that I very rarely think about the place. The rent covers the mortgage and landlords insurance and thats pretty much all I care about. Not really sure what our long term plans are for it... but like I say, I don't really think about it at all

Sioban

This is so, so the position I want to be in! Just need to find a "trusted Agent" who can do their job well!

shouldistayorgo

Hiya,

We were lucky enought to not have mortgage when we left London. I asked a mate who is a builder to visit the property 4 times a year and also to do any repairs when needed.

I then got a local estate agent to find tenants and rent out the house.

They take 10%. If I did mot have my builder mate they would charge 18% to collect rent and manage repairs etc.

The builder mate I pay £150 per visit plus any repairs on top. No mate rates there but it seems to work very well.

Accountant then deals with uk tax returns. send him estate agent statement every month via email. Told us we should not have too much of a tax bill if anything at all but do declare it...taxman always gets you in the end.


Before we left I had electrics checked and repaired where necessary. Gas was checked and certificates got. I put in new oven , new fridge , new dishwasher, decorated house and retiled bathroom. Don't forget landlords insurance.

In all spent about 6-7k before we left . We completely emptied house of all personal stuff. Must have visited charity shop 20-30 times and the tip 15 times. Did good bit of decorating ourselves.

JAJ

There is no "tax legislation dictation".

It's really simple. As a PR/citizen living in Australia, you ALWAYS have to file an Australian return including the income.

You probably won't have any UK tax to pay, but if you do, you offset it against the Australian tax.

You possibly need a good tax accountant to help you work it all out.

And by the way, it won't be a "huge bill" as you put it, at most it will be around 45% of the profit you make and only then if you earn enough to pay the top rate of tax. That is not all that unreasonable when set against the benefits of being part of the Australian community and having access to the health, education, social and other services offered in Australia.

Turban Explorer

Bermudashorts

I am not sure what you mean by "Tax FA" but you put your income nad expenses on the UK tax return and would pay tax on anything exceeding your personal allowance.


It is irrelevant whether you "fare better", you cannot chose. The double tax treaty between Australia and UK is where you find the details as to what it paid where, but it is not recommended reading

You probably will end up paying Australian tax on it, because unless you have a very high rental income and a very low mortgage, you probably won't exceed your UK tax allowance, especially if the property is in two names, in which case recenue and expenses are split and there are two allowances to absorb. In this case the Australian one kicks in.

In Exile

seconded.

"its the price to pay for living in paradise" - give me a break.

hobbis

Anyone know a good landlord specific insurance company

Lois1

We plan to do the same and rent out UK property and therefore rent in Oz.

My question is, for tax purposes, once we have deducted mortgage, agency fees, wear & tear, insurance etc from the rental income, can we also then offset our Oz rental fees against it??

Sorry if this is a dumb question, but i'm not that finincially minded (as you have probably gathered!)

Thanks

Cape Blue

No you cannot offset your Oz rental fees. Note you can only offset your UK mortgage interest and not the repayment part.

hobbis

Posts here say that you need a really good accountant she you have Uk rental income - how do you go about finding one? would appreciate help.

Mrs Jackaroo

Yep its pretty good - but it didn't start out so well - changed agents once after it was apparent they were only interested in helping themselves rather than us, and taking advantage of us being on the other side of the world. Thankfully we only had the first ones for about 12 months and since then all has been awesome!

Ozzidoc

What is your exit strategy?

This question for the OP and anyone else who is considering renting.

(Ours, if you're interested, is buy and hold.)

Turban Explorer

I intend to sell my 2 buy to let properties and keep my Islington house before we get PR here. The house, we'll probably live in again at some stage.