Joseph James

This will be our first adventure to work and live in Australia!!! Have decided to rent our UK house and have been advised by an estate agent to apply for a non resident landlord form to get gross rental income. Our worry is about Australian taxation especially when we decide to sell our house should we love it down under. In the UK, you don't pay a capital gains tax (CGT) on you rmain residence but will we get taxed while in Australia?

Hope anyone has any idea or experience on this. Thank you.

Grayling

You will be liable for Australian tax on any rental income.

G

MartinLuther

Have a look at this thread. Especially the excellent post 51

http://britishexpats.com/forum/showthread.php?t=608849

MartinLuther

And you'll be able to tax deduct rental loses against Aus income.

ABCDiamond

Ensure you claim all expenses against the rental income, to create the net profit from renting. It will be this figure that any tax is payable on.
ie: After Mortgage Interest, (not capital repayments), agents fees, bank account costs, phone calls, repairs and travel costs for an annual inspection (but ONLY if that is ALL you do in the trip).

In Australia we don't pay capital gains tax (CGT) on a main residence either, and we can select which property we choose to be a main residence, even if we do not live in it. There is a six year rule for some aspects of this.

markbhx

I assume this is if you make a profit? We rent a UK house out but make roughly a $200 loss per month on it. We completed our first UK non resident tax form in 2009 sent in May 2009 and still waiting for them to review it.. unbelievable!

Should we expect anything back from UK tax office? I'm suspecting not given past dealings with UK tax office.

In regard to claiming for flights back to the UK to "inspect" the property, has someone done this? I assume the time spent in the UK would have to be only a few days to prove you only went back to check the property?

Our first tenants did a runner from the property owing rent, caused minor damage etc. We booked a trip back to visit family/ friends but spent about a week sorting the house out, would that have been claimable? How do you prove the reason for the trip back to the UK?

Do you claim UK property expenses on the aussie tax return or the UK one?

ABCDiamond

We have done Brisbane to Sydney flights for that.

I am sure they would reject that one as you visited friends/family.
How to prove it ? Good question.... I think you would need to provide diary evidence of your movements, and justification for the trip..
This example may not work...
If you are an Australian tax resident, then all your income needs to be declared on your Australian tax return, even if you also do a UK one. Any UK tax paid would be offset though.

Joseph James

thank you to all who shared their ideas and experiences. additional info. will be much appreciated.

MichPayne

Help! Can any one advise me on tax returns?? I worked for a hospital in Brisbane between feb and June 2009 I payed on PAYG. I was told to lodge my tax retuen when I came back to the UK so I did and now I have a bill from the tax office for $1660? how can that happen, I was paying tax and was told I could claim my tax back on return to UK?

I wonder if I've filled my return in worng as I did it online and never done one before, what can I do?

Mich

ozhappy981

Yes, that is a very common myth . If you worked from Feb to June 2009, you would be classed as "non-resident for tax purposes". That means you pay 29% on your taxable income up to $34,000 (there are then higher rates for income above that, but if you only worked between Feb and June I guess your income was below $34,000).

Chances are your employer by mistake put you on resident's tax rates. This would have meant you were (incorrectly) given a tax-free tthreshold and taxed at lower rates. That is why you have now ended up with a tax bill.

Anyway, you can check it out yourself: Have a look at your "Notice of Assessment". Look at the figure for "taxable income". Multiply that by 29%. And that should give you your total tax due. Less tax paid will come to $1,660.

[There is no Medicare due for non-residents.]

MichPayne

Hi.

I was actually there on sponsorship and 457 visa and now believe i should have completed my tax return as a resident and not as a non resident? if anyone can confirm that would be appreciated..

Thanks...

ozhappy981

No. As per my previous post above, you were "non-resident for tax purposes" (because you were only in the country for such a short time - per your post). Therefore you completed the tax return correctly.