British Expats - Renting a property out in the U.K.

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Renting a property out in the U.K.

Hi,

We are considering buying a property in the U.K to rent out when We finally get Our visas for Aus. Does anybody know if tax has to be paid in Aus as well as the U.K? Any ideas on this matter would be appreciated.

Thanks

Sharon xx

Tax would have to be paid in Aus on worldwide income including UK rental income. UK has a double taxation agreement with Aus which means you would not pay tax twice on the same income. (But I'm not too sure which country gets the tax and, if the tax rate is different in each country, which rate is payable. I assume your tax liability would principally be to the country you are tax resident in.)

Cheers - Don

Quote:

Originally posted by pleasancefamily
Tax would have to be paid in Aus on worldwide income including UK rental income. UK has a double taxation agreement with Aus which means you would not pay tax twice on the same income. (But I'm not too sure which country gets the tax and, if the tax rate is different in each country, which rate is payable. I assume your tax liability would principally be to the country you are tax resident in.)

Cheers - Don

If you use an agent they will automatically deduct tax from the rent unless you fill out a form from the Inland Revenue.

You have to declare all your income earned on your Aussie tax return, including the rental income, whether or not it has actually be transferred into Australia.

Re: Renting a property out in the U.K.

Hi Sharon.

Issues to watch from a tax perspective:

1. Income tax - in the UK and Australia (once you are an Aussie tax resident you are assessable on your worldwide income). You should retain an entitlement to UK personal allowances, which usually covers the net rental income in the UK. Also, a depreciation allowance might be deductible when completing your Aussie Tax Return, depending on the age of the let property - not possible in the UK.

2. Capital gains tax - depending on your tax residency status when you sell the property.

3. Inheritance tax - might be payable in the UK on UK real estate even if you cease to live there and can establish non-UK domiciled status.

Also - watch the withholding tax provisions in Australia if you will be retaining a loan of any kind.

Dare I say ... formal professional advice is probably a good idea so that you can make an informed decision.

Best regards.

Quote:

Originally posted by hollywood110
Hi,

We are considering buying a property in the U.K to rent out when We finally get Our visas for Aus. Does anybody know if tax has to be paid in Aus as well as the U.K? Any ideas on this matter would be appreciated.

Thanks

Sharon xx

Re: Renting a property out in the U.K.

Quote:

Originally posted by Alan Collett
Hi Sharon.

Issues to watch from a tax perspective:

1. Income tax - in the UK and Australia (once you are an Aussie tax resident you are assessable on your worldwide income). You should retain an entitlement to UK personal allowances, which usually covers the net rental income in the UK. Also, a depreciation allowance might be deductible when completing your Aussie Tax Return, depending on the age of the let property - not possible in the UK.

2. Capital gains tax - depending on your tax residency status when you sell the property.

3. Inheritance tax - might be payable in the UK on UK real estate even if you cease to live there and can establish non-UK domiciled status.

Also - watch the withholding tax provisions in Australia if you will be retaining a loan of any kind.

Dare I say ... formal professional advice is probably a good idea so that you can make an informed decision.

Best regards.

Thanks to all of You who replied to my question, has helped alot,think We will just sell everything it will be easier!

Take care

Sharon xx