What are tax implications of renting a UK property out?

**Mongoose** · 27-01-2009, 07:01 AM

If we don't sell our U.K place in time-we have decided to rent it out, and go to Aus anyway.
What are the tax implications? I.E. renting the property out to family friends just to cover house running costs and small mortgage?
We would probably charge them £500 a month. Similar properties are being rented for £600-£650 in the area, but we really do just want to cover costs, and know the house will be well looked after and kept in one peice!!
Thanks

**helen & simon** · 27-01-2009, 07:33 AM

Hi there,

If you are leaving the UK permanently you can apply to receive rent tax free as a non-resident landlord. Obviously individual circumstances vary but you will need to contact your local HMRC office for form P85(Leaving the UK). They will advise you where to go from there.

Helen

**Tim** · 27-01-2009, 07:59 AM

Thats correct and it will be treated as income and taxed accordinly. Its probably best you don't tell the Aussie Tax office if you work in Australia during this time as they will probabkly want their share. The good news is you can only be taxed in one country (if applicable). Best seek some professional advice. Allan Collette on this forum should be able to advise further as he's aslso an accountant by trade.

Tim

**SD_MOA** · 27-01-2009, 10:21 AM

Originally Posted by Mongoose

If we don't sell our U.K place in time-we have decided to rent it out, and go to Aus anyway.
What are the tax implications? I.E. renting the property out to family friends just to cover house running costs and small mortgage?
We would probably charge them £500 a month. Similar properties are being rented for £600-£650 in the area, but we really do just want to cover costs, and know the house will be well looked after and kept in one peice!!
Thanks

Hello Mongoose,
I'd suggest contacting Alan Collett at Go Matilda (alan@gomatilda.com). He is an expert in this area as he is an Accountant in both UK and Australia.