Jimbo9

Hi,
If you rent out your UK property do you pay tax on the rental income to the UK or the Aussie tax man? Is there any expat who is currently doing this who could share their experiances?

Thanks Jim

soapy©

If u PM jasonK944 Im sure they can tell you more about this.

Jimbo9

Thanks Soapy

eintracht

Jimbo,
Would be interested in any info you get on this subject please ?
Thanks

Chris

soapy©

Hes a nice guy, just drop him an email, he will help you out. his real name is Frank.

Jacko1

If you are offshore, living abroad on a permanent basis you are not liable to pay tax in the UK. However if you return for more than a few days, not sure how many, you would become a UK tax payer.
You will have to pay tax in the country of residence (Aus) and there will be a section on the tax return for earnings from abroad.

There is info on this on both the IR website and the Australian equivalent

Good Luck

PJ

kirsty&al

I'm afraid this is one of those cases where the normal rules do not apply.

http://www.inlandrevenue.gov.uk/cnr/nr_landlords.htm

You will have to apply for an exemption from paying tax (detailed in the above link), otherwise you will have to get your tenant or letting agent pay it for you, every quarter!

Cheers
Alistair

Jacko1

More detailed info is in Book IR20, all depends on resident Status

http://www.inlandrevenue.gov.uk/pdfs/ir20.htm

PJ

Jimbo9

I see that you can get exemption from having tax collected by the letting agent/tenant but it still says the income is liable for tax and must be declared on your tax return if you get one - I fear i will ! Also getting worried about CGT liability if I later sell the house when non-resident or would this only apply to any gain after we leave?

Jacko1

Aftre two years offshore you will be exempt from UK CGT, however, you may be liable to Aus version. Speak to an accountant with offshore experiance etc.

My accountant was a goldmine

Paul J

sjn2003

Assuming you will be non-ordinary resident in the UK for tax purposes ie living permanently in Australia with no intention of returning, some of the above posts are correct in that you will be liable to UK income tax on rental profits.

Notice the word profit and not rental income - you still only pay on profit which after mortgage interest and repairs etc shouldn't be too much. You are also entitled to your full personal allowance (assuming you are UK citizen) so hopefully you will have no tax to pay

The law states that it is your tenants/agents responsibility to deduct tax from the rent and pay the taxman. You would then recognise this on your tax return. Sounds like a lot of grief to me, so we have applied to have our rents paid gross (pretty easy to do - takes 4 wks to sort out before you go). Check the link earlier to Non Resident Landlord Centre at Bootle.

You must always fill out a tax return if you have rental property. Under Self Assessment don't wait to be asked to by the Revenue !!

Hope this helps

Bix

I had a rental agent with me today.
He is compelled to deduct tax from the rental income unless you get one of the above mentioned Non Resident Landlord exemption certificates from the inland revenue.

As I understand it you will be able to deduct the mortgage, buildings & contents insurance, rental agents fees and any maintenance or repair costs from the rental income. In my case this will leave little if any profit. It's the profit that is taxable in Aus.

Don

Mortgage interest not capital repayment

Don

INCORRECT. UK-derived income incl rental income is liable to tax in the UK even for non-residents.

Don

Non-residents are not liable to UK CGT provided they sell the asset during the period they are non resident and stay away from the UK 5 complete tax years. (Unless you're Don: I qualify for no CGT under a different IR rule. )