Some property/legal questions.
Aug 16th 2009, 2:30 pm
#1
'Made in Ulster' Member
Thread Starter
Joined: Dec 2008
Location: Brisbane, QLD. (Though an Ulster girl through and through!)
Posts: 6,578
Some property/legal questions.
Ok, I am in Northern Ireland at the moment where I own a property. In an ideal world I will be able to sell that property before leaving for Australia sometime next year (all being well), however, this is not an ideal world so it might not sell before we go. So, some questions....
1. If a month or so before we're due to go there looks like no chance of it selling, I might have to decide to instead let it out. I will therefore need to change my type of mortgage. Something makes me think if I take out such a mortgage I'll be tied to it for 2 years or more, can you get mortgage deals for letting out that last basically as long as you decide to let it out, ro do most of them have a deal length of 2 years or more?
2. I have read somewhere on here that as I'd be letting out a property in the UK (making no profit from it, just clearing the mortgage) I'd be allowed some sort of exemption from taxes or something? What exactly does this involve and how much will I be exempt?
3. We do not intend to buy in Australia as we'll be reposted every 3 years (Australian Army) so the only property I will own will be the UK one. If I sell this property whilst in Oz will I have to pay tax on it if it is my only property?
4. Will selling a property in the UK whilst living in Australia be a difficult thing to do, or fairly straightforward. Will I just be instructing someone (solicitor for example) to do it for me?
5. If I was to let out my UK property I would be doing so, unfurnished, but would I be expected to leave somethings for the tenants, if so, what?!
Anything else I've missed?
Thanks people for your help
1. If a month or so before we're due to go there looks like no chance of it selling, I might have to decide to instead let it out. I will therefore need to change my type of mortgage. Something makes me think if I take out such a mortgage I'll be tied to it for 2 years or more, can you get mortgage deals for letting out that last basically as long as you decide to let it out, ro do most of them have a deal length of 2 years or more?
2. I have read somewhere on here that as I'd be letting out a property in the UK (making no profit from it, just clearing the mortgage) I'd be allowed some sort of exemption from taxes or something? What exactly does this involve and how much will I be exempt?
3. We do not intend to buy in Australia as we'll be reposted every 3 years (Australian Army) so the only property I will own will be the UK one. If I sell this property whilst in Oz will I have to pay tax on it if it is my only property?
4. Will selling a property in the UK whilst living in Australia be a difficult thing to do, or fairly straightforward. Will I just be instructing someone (solicitor for example) to do it for me?
5. If I was to let out my UK property I would be doing so, unfurnished, but would I be expected to leave somethings for the tenants, if so, what?!
Anything else I've missed?
Thanks people for your help
Aug 17th 2009, 12:32 am
#2
Guest
Posts: n/a
Re: Some property/legal questions.
Once Tax resident in Australia, you would need to include all details on your ATO tax return, but if the interest, and all other expenses that you pay, exceed your rental income, then NO tax would be payable here.
As far as the UK side goes, it will be exactly the same.
IF you did pay tax in the UK, that would be allowed to set off against any tax payable in Australia.
Aug 17th 2009, 12:37 am
#3
Guest
Posts: n/a
Re: Some property/legal questions.
I instructed a Solicitor to sell my UK house while I was in Australia, I gave him my power of attorney. He did everything, it went smoothly and I just paid him
When my money arrived in my UK bank, my bank manager rang me and asked where and when I wanted it transferred.
I remember the call vividly.... I jumped for joy when I heard the figure, and being 2 am when he called, I wasn't fully awake, and "jumping for Joy" my fingers got hit by the spinning ceiling fan
Aug 17th 2009, 4:56 am
#4
'Made in Ulster' Member
Thread Starter
Joined: Dec 2008
Location: Brisbane, QLD. (Though an Ulster girl through and through!)
Posts: 6,578
Re: Some property/legal questions.
I can answer this one from personal experience.
I instructed a Solicitor to sell my UK house while I was in Australia, I gave him my power of attorney. He did everything, it went smoothly and I just paid him
When my money arrived in my UK bank, my bank manager rang me and asked where and when I wanted it transferred.
I remember the call vividly.... I jumped for joy when I heard the figure, and being 2 am when he called, I wasn't fully awake, and "jumping for Joy" my fingers got hit by the spinning ceiling fan
I instructed a Solicitor to sell my UK house while I was in Australia, I gave him my power of attorney. He did everything, it went smoothly and I just paid him
When my money arrived in my UK bank, my bank manager rang me and asked where and when I wanted it transferred.
I remember the call vividly.... I jumped for joy when I heard the figure, and being 2 am when he called, I wasn't fully awake, and "jumping for Joy" my fingers got hit by the spinning ceiling fan
Fingers ok?!
Aug 17th 2009, 5:11 am
#5
Forum Regular
Joined: Nov 2007
Posts: 35
Re: Some property/legal questions.
Hi
If you have a mortgage "technically" you must tell your mortgage company. A lot of people don't- just make sure you redirect your mail ( via Royal Mail for 2 years)
Make sure you take out landlords house/contents insurance. Not through the same company as your mortgage!
If the house is held in both your names you both have the tax free allowance. Interest payments ( not capital ) are tax deductible, as are a host of other things- it's highly unlikely any tax will be due in a full financial year.
I would try to rent it only partially furnished. Fully furnished too much aggro and very little £ difference. Stuff tenants will want- white goods and wardrobes ( if they are not built in).
Good luck
If you have a mortgage "technically" you must tell your mortgage company. A lot of people don't- just make sure you redirect your mail ( via Royal Mail for 2 years)
Make sure you take out landlords house/contents insurance. Not through the same company as your mortgage!
If the house is held in both your names you both have the tax free allowance. Interest payments ( not capital ) are tax deductible, as are a host of other things- it's highly unlikely any tax will be due in a full financial year.
I would try to rent it only partially furnished. Fully furnished too much aggro and very little £ difference. Stuff tenants will want- white goods and wardrobes ( if they are not built in).
Good luck
Aug 17th 2009, 11:41 am
#6
Just Joined
Joined: Jan 2008
Posts: 10
Re: Some property/legal questions.
I would think very carefully before considering not getting a consent to lease from your mortgage lender. Banks and lenders seem to be taking quite a hard line with borrowers at the moment and they may repossess if they got wind of you letting the place without getting permission.
I think you can get a consent to lease for a maximum of three years, they will usually bump up the interest rate you pay as well. If you have plenty of equity in your property, maybe a buy-to-let, interest only mortgage would be better? They are a bit more flexible and bear in mind only the interest payments on the mortgage can be offset against tax, any repayments will need to be calculated separately. I think you can also offset any other reasonable costs, like agency letting fees, repairs, some decorating, service charges etc.
I think you become liable for capital gains tax after being out of the property for three years - not sure about this though. If the mortgage is a joint one, you can use both you and your partner's tax allowances.
I think you can get a consent to lease for a maximum of three years, they will usually bump up the interest rate you pay as well. If you have plenty of equity in your property, maybe a buy-to-let, interest only mortgage would be better? They are a bit more flexible and bear in mind only the interest payments on the mortgage can be offset against tax, any repayments will need to be calculated separately. I think you can also offset any other reasonable costs, like agency letting fees, repairs, some decorating, service charges etc.
I think you become liable for capital gains tax after being out of the property for three years - not sure about this though. If the mortgage is a joint one, you can use both you and your partner's tax allowances.
