tonyghiggins

Hello all,
With the huge cost of houses in the bay area, I was planning on selling my home back in the UK and transfering the fund over to help with a down payment.
I have a couple of questions regarding this if any of you experts can help

1. I lived in the house for approx 2 years, have since been renting it out for approx 6 years. When I sell it would I be liable for any kind of tax?

2. When I do a bank to bank electronic transfer of the funds, do I need to let anyone in the US know, ie feds, tax people? Will they be hunting me down for tax in the US?
I have an offshore account in Jersey transfering to wells fargo in the US.

Appreciate any feedback.

AvromShalom

I'd suggest taking proper advice from a UK based accountant / tax specialist , you can legitamatley avoid a lot of tax due quite legally if you get someone who knows what they are doing.

Big D

Get some proper advice - the fact that you have rented for 6 years might be an issue. Any movement of money over $10k gets the attention of banks for money laundering regulations but not specifically tax. you could well be liable for capital gains tax in the UK - like I said there are probably ways round it but you will get a lot of yes and no answers from here - everyone's position is slightly different. Probably not worth risking it without proper kosher advice! Good luck

tonyghiggins

OK thankyou, anyone know a good accountant for these purposes around the Bristol area?

farmerwife

Hi west Coast Tony

Seeing from your moniker that you probably reside on the west coast (of the USA) ...assuming you are an LPR, you would be subject to US tax (and the IRS ....they are interested in your worldwide income).
So what about a local CPA with knowledge of that dual UK/US tax treaty thingy? Being rented out makes it 'business' especially 6 years, not primary residential.
Bristol .... used to live there... well .. 2 streets over - Staple Hill.
And usual caveats- I'm not a lawyer, accountant etc.

Jerseygirl

Try the search option at the top...this subject's been discussed many times...so you may find what you are looking in an old post.

joliwasfi

Tony,

I am a UK qualified accountant (living in Bermuda but hoping to relocate to the US - so will be asking for certain advice myself on these boards......).

I can answer in relation to UK taxes but not US taxes. here goes :

How long have you been outwith the UK ? If you have lived outwith the UK for at least 5 FULL tax years (i.e. 6th April to 5th April) then you will suffer no Capital Gains Tax (CGT) or income tax on the house sale (this is the result of new legislation brought in a couple of years ago - I took advantage of this myself last year.

If you have not been outwith the UK for 5 full tax years you will be subject to CGT on the proportion of your profits when you didn't live in the house.

Whilst you lived in the house it was your PPR (Principal Private Residence) so you are not subject to CGT. However, the period when you were renting it obviously meant it was not your PPR and therefore IS subject to CGT on the profits.

If you need any more help please PM me.

fatbrit

And possibly the US too if Uncle Sam finds out about it!

Elvira

How likely?

fatbrit

Possible! Need facts -- and I ain't got many to work with. But what Uncle Sam doesn't know won't hurt him.

Bob

Capital Gains will hurt, and if profits are over $80K uncle sam will want a cut....to transfer the money, www.xe.com it takes a few days to set up, but gives best rates.

scrubbedexpat099

This subject comes up now an then, I seem to remember somebody who posted who said they did declare their profit and paid tax to Uncle Sam.

But only one, all the other threads died.....

Moving the proceeds is not the problem.

I may be wrong, but I think that assuming taxable in the UK then the Capital Gain will be the increase whilst it was rented, as far as the US is concerned the increase whilst you owned it....

And as far as an Accountant up on both UK and US,well that gets asked a lot as well. I was told there was one in CO, but he was not cheap. My wife used Price Waterhouse in the UK and they took forever and her situation was not that complicated, fortunate that she was not paying.

AJP1

Varying this ever so slightly, what if one is living in the UK property and selling it to move to the US.

My scenario - my wife (USC) and I, are awaiting an I-130 application while living in the UK. At some point, we need to sell our place here (in my name, since bought before marriage, but effectively 'our' home) and move the proceeds to the US to put a downpayment on a place there when the visa application process is completed. My wife is a student and therefore pays no US tax, so I do not have a IRS Tax Number and, so far as we can tell, cannot be named on a joint bank account with her in the US. It has been suggested that if we sell the place in the UK and simply move the money to a US savings account in her name, it could be seen as income there and liable to US tax?

Surely not?

Jerseygirl

I think I am correct in saying if you are living in your UK house and it is your main residence you are allowed a period of time in which to sell it before the profit becomes taxable in the US. Therefore if you move here and sell it within 2 or 3 years...the profit is not taxable. You would then have your own US bank account for the proceeds to be transferred into.

scrubbedexpat099

Gifts between spouses are not treated as income.

Sell House

Move to US

Open Bank Account

Transfer money from your UK account to US account.

Can all be done by phone.