FOR ALL YOU BOFFINS OUT THERE!! Questions on renting out UK property!

sadsmile23 · 16-05-2008, 08:06 AM

Hi all
This is a question for all you tax and financial boffins out there!!
Im sure these questions have been asked before, but thought I'd ask them all together so i can try and understand the pros and cons of renting:

1. I understand that if we left our UK property and rented it out, we would have tax to pay - however, I believe you can offset certain costs against the rental income, such as mortgage, house insurance, agent costs etc. Is this correct?

2. I have been told we would need to fill in form NRL01 for the Inland Revenue (non-resident landlord) and declare our income on this. Is it just the income from UK rental property we would declare?

3. Assuming the money we would earn in Oz would not need to be declared on UK tax forms, as we would already be taxed on this in Oz?

4. Similarly, the money we would earn (actually nothing really, doesnt even cover our mortgage payments!!) in the UK would not need to be declared in Oz, coz we are paying UK taxman?

Are there any other implications, or pros or cons that anyone can think of, that I havent, that you can give advice on too please?

Many thanks, brain-boxes!!!

sadsmile23 · 16-05-2008, 05:29 PM

>>>>>>>>BUMP<<<<<<<<<<<

WHERE ARE YOU ALL???? come on intelligent people!!

TheBrammies · 16-05-2008, 06:11 PM

hi i dont know either but and very interested in the answers

tommo64 · 16-05-2008, 07:49 PM

Hi,

Sorry, can't really help on this one but I am watching this space as we may well be in the same situation soon, especially considering the state of the UK housing market.

Tom

sadsmile23 · 17-05-2008, 08:14 AM

>>>>>>>>BUMP<<<<<<<<<

Keep bumping and hopefully someone will help soon!!!!

pabloke99 · 17-05-2008, 11:16 AM

What you have said sounds about right. We shall be doing the same, but as its still quite a few months off I haven't looked into too much detail. I'm not sure what to tell the mortgage company either, I image they are used to people moving overseas at short notice and having to rent their houses out without incurring the extra interest rates of a BTL mortgage.

marty and debs · 17-05-2008, 11:37 AM

Hi im no expert but what you said sounds about right, did you know that if you rent out your house when you move to oz you will pay CGT on and increase in its value from when you move out to when you sell. Hope that is of some help.
Marty.

pabloke99 · 17-05-2008, 12:14 PM

And perhaps claim back Capital Loss Tax if the value is less (if only). Seems as though the cards are always stacked against us.

bobbinational · 17-05-2008, 04:39 PM

I contacted Abbey about this as selling my house looks like it could be a struggle, they wrote to me and said that the conditions of the mortgage say they COULD cancel my fixed rate and swap it for a Buy To Let mortgage (costing early repayment fee etc) but because I am an existing customer they would allow me to rent out the property and just charge me an admin fee of £195. So it would be worth you checking as they might not be as harsh as you think.....

Ryan, Rachel & Beth · 17-05-2008, 05:47 PM

Quote:

Originally Posted by bobbinational

I contacted Abbey about this as selling my house looks like it could be a struggle, they wrote to me and said that the conditions of the mortgage say they COULD cancel my fixed rate and swap it for a Buy To Let mortgage (costing early repayment fee etc) but because I am an existing customer they would allow me to rent out the property and just charge me an admin fee of £195. So it would be worth you checking as they might not be as harsh as you think.....

This is such an interesting topic, I hope there will be more posts on it.

I work as an Estate Agent and although I'm confident that we would achieve a buyer on our property we have decided to rent our property for the first year at least. We were bargaining on changing our current re-payment mortgage (which is also with Abbey) to an interest only mortgage and therefore the rental income for the first year will more than cover our mortgage (luckily we have a small mortgage.) I wondered if anyone knew would we have to declare we are renting out our property just incase the mortgage lender insists on a buy to let mortgage or something went wrong with the tenant?

I imagine we are all feeling the strain, with the property market not being as strong and the exchange rate so low it is much more of a serious factor in knowing what to do 'financially' for the best.

Look forward to hearing some more replies, Rachel x