Anyone renting out UK home?
#1
Anyone renting out UK home?
Just wondering if anyone has any help and advice to offer if they rent, or have rented, their UK home and rented in Spain? We're beginning to think that this may have to become an option we didn't want to take if things don't improve in the housing market. Our thinking being that we could then hold on to the UK property until the market at least bottomed out, and preferable picked up a bit. Any sensible comments would be helpful.
#2
Re: Anyone renting out UK home?
Just wondering if anyone has any help and advice to offer if they rent, or have rented, their UK home and rented in Spain? We're beginning to think that this may have to become an option we didn't want to take if things don't improve in the housing market. Our thinking being that we could then hold on to the UK property until the market at least bottomed out, and preferable picked up a bit. Any sensible comments would be helpful.
Any rental income would be taxable in UK but you can offset some of the above costs against tax due and with a good accountant you may not pay any tax.
Spanish upfront costs have to be considered but I do not know what the costs would be.
Last edited by EsuriJohn; Nov 24th 2008 at 11:59 am.
#3
Re: Anyone renting out UK home?
Thanks for your input John & Kath. We would be hoping to leave it part furnished so that's something to bear in mind there. As for Spain, we have a property sorted to rent when we get out there so we know what we're in for there. We just didn't want to end up giving our house away in this market and thought it was a way we could still be able to get out to Spain. I am self employed and would be doing the same thing in Spain with my UK clients and paying tax on that income in Spain. I did, however, think it may be worth chatting to the accountant I currently use here in the UK to see what the tax implications of renting would be as most rental income would be swallowed up on expense of the house.
#4
Re: Anyone renting out UK home?
You will have upfront costs on the UK property just to rent it out. You need to have an energy performance certificate, gas certificate, electricity certificate and smoke alarms also if you leave any small appliances they have to be certified then there is the agents fee if you use one say 10%.
Any rental income would be taxable in UK but you can offset some of the above costs against tax due and with a good accountant you may not pay any tax.
Spanish upfront costs have to be considered but I do not know what the costs would be.
Any rental income would be taxable in UK but you can offset some of the above costs against tax due and with a good accountant you may not pay any tax.
Spanish upfront costs have to be considered but I do not know what the costs would be.
The agents fee will be plus VAT.
You also need special insurance, if the house is on a mortgage you have to have the permission of the mortgage company, who will normally increase your interest rate.
The tennants deposit will have to be protected with one of the protection schemes.
If you use an agent, be very carefull. It is better to vet the tennant yourself than trust an agent.
#5
Re: Anyone renting out UK home?
As well as your P85 you will also need to complete an NRL1 form to receive the rental gross, otherwise the agent will need to deduct tax.
Consider a lettings insurance that also covers you for legal costs of removing non-paying tenants. Some can also cover for emergency repairs - i.e. the electricity goes out on a Sunday night, you are in Spain and the letting agent will be useless, the tenants phone an emergency sparky and suddenly you are a 1,000 quid lighter - this insurance gives the tenants a number to call and the first 500 of a call out is covered by the insurance who manage the trades person to minimise over-charging.
Wear & tear occurs more quickly in a let property, be prepared to set aside 50-100 pcm towards repair bills - a 1500 quid boiler would take 15-30 months of wear & tear money, the place will need painting every 5 or 6 years (or before you sell it) and so on.
Base your financial projections on 11 months rented and one empty.
Consider a lettings insurance that also covers you for legal costs of removing non-paying tenants. Some can also cover for emergency repairs - i.e. the electricity goes out on a Sunday night, you are in Spain and the letting agent will be useless, the tenants phone an emergency sparky and suddenly you are a 1,000 quid lighter - this insurance gives the tenants a number to call and the first 500 of a call out is covered by the insurance who manage the trades person to minimise over-charging.
Wear & tear occurs more quickly in a let property, be prepared to set aside 50-100 pcm towards repair bills - a 1500 quid boiler would take 15-30 months of wear & tear money, the place will need painting every 5 or 6 years (or before you sell it) and so on.
Base your financial projections on 11 months rented and one empty.