Go Back  British Expats > Living & Moving Abroad > New Zealand
Reload this Page >

Capital gains tax - selling after renting in UK

Capital gains tax - selling after renting in UK

Old Nov 9th 2009, 5:12 pm
  #1  
Forum Regular
Thread Starter
 
Joined: Aug 2009
Location: Beachlands, Auckland
Posts: 211
Cadibel has a brilliant futureCadibel has a brilliant futureCadibel has a brilliant futureCadibel has a brilliant futureCadibel has a brilliant futureCadibel has a brilliant future
Default Capital gains tax - selling after renting in UK

Have looked on the forum and only found reference to capital gains tax in NZ - so just wondering - if you rent your house in the UK and then sell it from NZ - do you have to pay capital gains tax in the UK?

So if there is anyone out there who has sold after renting PLeeeese let me know!
Cadibel is offline  
Old Nov 9th 2009, 10:10 pm
  #2  
BE Forum Addict
 
Genesis's Avatar
 
Joined: Sep 2006
Posts: 4,274
Genesis has a reputation beyond reputeGenesis has a reputation beyond reputeGenesis has a reputation beyond reputeGenesis has a reputation beyond reputeGenesis has a reputation beyond reputeGenesis has a reputation beyond reputeGenesis has a reputation beyond reputeGenesis has a reputation beyond reputeGenesis has a reputation beyond reputeGenesis has a reputation beyond reputeGenesis has a reputation beyond repute
Default Re: Capital gains tax - selling after renting in UK

Originally Posted by Cadibel View Post
Have looked on the forum and only found reference to capital gains tax in NZ - so just wondering - if you rent your house in the UK and then sell it from NZ - do you have to pay capital gains tax in the UK?

So if there is anyone out there who has sold after renting PLeeeese let me know!
I have not but beleive you ARE liable for UK taxes on such a deal. They apparently only take the profit from when you left the house to what it is worth when you sell it now. IE When it was your home and was worth 300k, now it is worth 350 since renting it you pay the tax on the 50k. That's how it was explained to me and I think you are allowed some grace for a period of time when any profit on the house is tax free. I guess the best place to check is Inland rev. UK. But we do have to pay UK taxes even when resident abroad..I know I do on dividends and bank accounts. There is a 4 year period of grace with the NZ Inland revenue for emigrees post april 2006 (i think thats the date) on any UK profit from anything basically. Hope this helps.
Genesis is offline  
Old Nov 10th 2009, 7:43 am
  #3  
BE Enthusiast
 
Joined: Jan 2008
Location: Howick, Auckland from Sheffield
Posts: 629
chocolate cake has a reputation beyond reputechocolate cake has a reputation beyond reputechocolate cake has a reputation beyond reputechocolate cake has a reputation beyond reputechocolate cake has a reputation beyond reputechocolate cake has a reputation beyond reputechocolate cake has a reputation beyond reputechocolate cake has a reputation beyond reputechocolate cake has a reputation beyond reputechocolate cake has a reputation beyond reputechocolate cake has a reputation beyond repute
Default Re: Capital gains tax - selling after renting in UK

Originally Posted by Genesis View Post
I have not but beleive you ARE liable for UK taxes on such a deal. They apparently only take the profit from when you left the house to what it is worth when you sell it now. IE When it was your home and was worth 300k, now it is worth 350 since renting it you pay the tax on the 50k. That's how it was explained to me and I think you are allowed some grace for a period of time when any profit on the house is tax free. I guess the best place to check is Inland rev. UK. But we do have to pay UK taxes even when resident abroad..I know I do on dividends and bank accounts. There is a 4 year period of grace with the NZ Inland revenue for emigrees post april 2006 (i think thats the date) on any UK profit from anything basically. Hope this helps.
I'm not totally sure, but if it was your sole home and then you started renting, there is a period of grace. After that it will then become taxable as a capital gain, apportioned over the period you owned it, with the period you lived in it proportionally exempt.
However the only values that matter are the gain from purchase date to sale date. It doesn't matter what it was worth when you started renting it......so it was bought for 150k, worth 350k when you started renting it then sold for 300k. The gain would be 150k apportioned over the time you owned it, it wouldn't matter that it was sold for less than when you first started renting it.
chocolate cake is offline  
Old Nov 10th 2009, 9:35 am
  #4  
BE Enthusiast
 
Joined: Nov 2004
Posts: 311
ukkiwi is just really niceukkiwi is just really niceukkiwi is just really niceukkiwi is just really niceukkiwi is just really niceukkiwi is just really niceukkiwi is just really niceukkiwi is just really niceukkiwi is just really niceukkiwi is just really niceukkiwi is just really nice
Default Re: Capital gains tax - selling after renting in UK

Take some proffesional advise on this - there's probably a way of side stepping any tax. Maybe you could go back and live in it again (on paper). MP's do it all the time.
ukkiwi is offline  
Old Nov 10th 2009, 10:50 am
  #5  
Just Joined
 
Joined: Aug 2009
Location: Blackpool
Posts: 11
GavinP is an unknown quantity at this point
Default Re: Capital gains tax - selling after renting in UK

Originally Posted by ukkiwi View Post
Take some proffesional advise on this - there's probably a way of side stepping any tax. Maybe you could go back and live in it again (on paper). MP's do it all the time.
Hi,
I'd like top chip in if that's ok. I am by no means a professional but I have looked into this as I anticipate I will be in a similar situation when it's time for me and and the Wahine to move over. You won't pay CG on your MAIN residence, although if you have (say) 3 other properties (making a total of 4) and sold the lot then you would be liable for CG on the 3.

Of course as UKKIWI said, there are ways and means (all legal) in which you can use the tax laws to your advantage like for example if you made the most valuable property your main residence........

Gav.
GavinP is offline  
Old Nov 10th 2009, 3:51 pm
  #6  
Forum Regular
Thread Starter
 
Joined: Aug 2009
Location: Beachlands, Auckland
Posts: 211
Cadibel has a brilliant futureCadibel has a brilliant futureCadibel has a brilliant futureCadibel has a brilliant futureCadibel has a brilliant futureCadibel has a brilliant future
Default Re: Capital gains tax - selling after renting in UK

Thanks to everyone for all your advice!

Gav - I wish we had 3 or 4 houses!! Fraid it's only the one, and that 'cos we can't sell at the moment!
Cadibel is offline  

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are Off
Pingbacks are Off
Refbacks are Off


Contact Us - Archive - Advertising - Cookie Policy - Privacy Statement - Terms of Service - Do Not Sell My Personal Information

Copyright © 2018 MH Sub I, LLC dba Internet Brands. All rights reserved. Use of this site indicates your consent to the Terms of Use.