How best to deal with rental property in UK

[Guest Johnthepom]

Hi all,

 

I am coming over to Melbourne in the next couple of weeks on a 457 Visa with my wife and youngest daughter, but my eldest daughter is staying in the UK studying, although she is on my 457 Visa so can visit whenever she wants.

 

We are not selling our primary home in the UK and are renting it to a relative who will keep a bedroom open for my daughter for inbetween terms and as a bolt hole should she need it.

 

Question is, I've read a number of threads that say it is hugely complicated taxation-wise to own a house in the UK and live/work in Australia.

 

Can anyone elaborate on the issues and also offer any thoughts on whether we would be better of transferring ownership of the UK house to my two daughters who wouild have limited/no tax liability.

 

Thanks in advance

John

[MARYROSE02]

Go and see a tax agent/accountant as you will probably have to do tax returns in both UK and OZ as I do because I have assets in both countries.

 

At the moment my tax status is resident in the UK but domiciled in OZ because I own a home there. However, when I buy my late father's home here (where I am still living) my domicile status may change. And when I return to OZ it might change again! I'm going to have to see an accountant myself!

 

There is a taxation agreement so that you don't have to pay tax on the same assets in both countries (I think!)

 

If you are depending upon rental income from your relative you may want to consider what would happen if they were unable to pay you? For that reason I think it is sometimes better to let a real estate agent manage it for you and they handle all the hassles to do with collecting rent/ repairs etc.

 

I almost wish I'd not replied now as I realize I've got to get some queries of my own fixed up!