Resident in Australia but still own a property in the UK?
Nov 23rd 2013, 1:45 am
#16
Social Grenade Thrower
Joined: Jan 2008
Location: South Coast, NSW
Posts: 3,625
Re: Resident in Australia but still own a property in the UK?
You have to if you rent out, otherwise you get taxed at rental source. I always prefer to play by the rules, false economy by playing with the law can get very expensive if caught.
Nov 23rd 2013, 8:14 am
#17
BE Forum Addict
Joined: Oct 2006
Location: Nowhere - I'm a travelling (wo)man!
Posts: 2,362
Re: Resident in Australia but still own a property in the UK?
Paddyo - the ATO can only advise you about Australian tax. They cannot advise you about UK tax. TBH, you can hardly expect them to know the ins and outs of every single tax jurisdiction in the world.
I can assure you that if your UK house is rented out, under UK tax law it is not one of your residences and thus would not qualify as an actual principal private residence. Some of the time would almost certainly count as a deemed residence and you would also qualify for letting relief. All of these things added together plus your annual CGT exemption may mean that no tax is payable (under current law, there would be no tax because you are non-UK resident anyway), but if the law changes so that non-residents have to pay CGT on the sale of UK property, you would have to report the transaction on a UK tax return and there may be tax to pay in the UK.
If you want to PM me the original cost of the house, the expected sale proceeds, the dates of purchase and expected sale, the dates you lived there and the dates between which it was available for letting, also whether in your sole or joint names, I'll have a stab at the tax IF the law changes.
I can assure you that if your UK house is rented out, under UK tax law it is not one of your residences and thus would not qualify as an actual principal private residence. Some of the time would almost certainly count as a deemed residence and you would also qualify for letting relief. All of these things added together plus your annual CGT exemption may mean that no tax is payable (under current law, there would be no tax because you are non-UK resident anyway), but if the law changes so that non-residents have to pay CGT on the sale of UK property, you would have to report the transaction on a UK tax return and there may be tax to pay in the UK.
If you want to PM me the original cost of the house, the expected sale proceeds, the dates of purchase and expected sale, the dates you lived there and the dates between which it was available for letting, also whether in your sole or joint names, I'll have a stab at the tax IF the law changes.
Nov 23rd 2013, 9:24 am
#18
Banned
Joined: Aug 2008
Posts: 22,348
Re: Resident in Australia but still own a property in the UK?
Nov 23rd 2013, 7:21 pm
#20
Retired
Joined: Apr 2004
Posts: 34,649
Re: Resident in Australia but still own a property in the UK?
The way to mitigate all of this is to deal with the U.K. strictly as a non-resident once you have left. Leaving aside legalities, it is a poor long term tax strategy to claim economic or social benefits based on being resident in the U.K. when in fact you are not.
