punkstaruk

Hi

Apologies if this has been asked/ answered in the past.

We currently living in the States and have a UK rental property. The income we generate just about covers the mortgage interest and with agency fees and repairs generate no profit.

We have been advised we need to complete a UK Self Assessment because of this property.

Does anyone know how we do this jointly, both my wife and I have notices to submit a return, do we half the income and half the costs (mortgage interest etc) on our returns?

Wish it was a simple as doing the joint return for the States.

nun

As long as you and your spouse actually own the rental property equally then you can split the income and the tax 50/50. You will each do self assessments an file HMRC Form 17

HartleyHare

We (me and husband) let our UK property whilst we are here in the US. Our property is in England and I think that there may be a different set of rules for Scotland and NI.

As we jointly own the property we both have to complete a UK self assessment. As we own our property in equal shares, our rental income, expenses and profit are split 50/50. As each share of the profit is below our UK tax allowence and we have no other UK sourced income, we don't have any UK tax liability.

The main self assessment form is SA100, but you will need to additionally complete form SA105 to report your rental information. The form can be found on the HMRC website along with the necessary information to help you complete the forms.

We did register and complete our self assessments on line via the HMRC website. It was very straightforward.


Here's some useful websites:

https://www.gov.uk/government/public...-tax-right-p85

https://www.gov.uk/renting-out-a-property/paying-tax

https://www.gov.uk/government/public...property-sa105

HTH

triptastic

We have the same situation - just calculate all the numbers and split 50/50 when you come to complete the return. Usually we leave a note in one of the extra boxes to state that the property is jointly owned.

Also, I use TaxCalc to do the UK SA return online. The cost includes multiple returns to be filed - so for married couple, just one price.

nun

When you do your taxes do you take the deductions and allowances on the UK side to come up with the net income, pay UK tax on that amount and then use that amount and the UK tax you've paid on your 1040 as foreign unearned income and FTC?

triptastic

I have yet to owe UK tax.

For US tax, I use TurboTax and follow the standard rental property section. It covers rental property outside the US.

nun

OK just make sure you don't deduct your rental costs twice. The UK has primary taxation authority and if after subtraction of the UK allowed expenses you end up with net rental income below the UK tax free allowance that simplifies matter as there's no FTC. Just use the gross rent and take the allowed US deductions as if it was a US property

uk_grenada

Understand that they will come after you for the capital gain at some point, that clock is ticking in their systems already, and that if you are deemed to not be uk domiciled, you dont have a uk personal allowance, so that all profits become taxable.

turivano

I am in a similar position, after finally getting confirmation from my company that they wont be assisting with the tax return, have signed up with turbo tax.

I may search out someone local to help but with the internet, some time and turbo tax I think our relatively simple case should be OK.

I have filled in the income for the UK house rental in TT and current filing jointly (I work, the wife doesn't). We are below the UK threshold so no problem with filling in the US return now.

What I would like to do is make sure her income from the UK gets considered in the US and we can use the dependent day care. TT seems to ignore this at the moment.

If anyone has any pointers that would be great. Maybe we need to file separately?

dcreelman

I have a rental property in NI, my wife and I each fill out a UK tax return and split the income and costs 50/50. We also declare the income from the property on our joint US tax return.

The income from the UK property is never enough to go over the tax free allowance in the UK.

On the us return you can claim you mortagae interest and any costs for the uk property as expenses, bu tif you generate a profit n the UK property, and don;t pay any tax on it in the uk, you will have to pay the tax in the US.