Do I Declare UK Rental Income On Both HMRC and ATO Tax Returns?

[Alan Collett]

Hello I-F.

 

First question: what is your Australian visa status? If you are heading to Aus as the holder of (say) a subclass 457 visa the UK rental income won't be taxable in Australia.

 

In terms of the assessable amount, the interest element of your mortgage repayments is allowable as a tax deduction, as will be any letting agent charges, costs of tenancy agreements, buildings insurance, etc.

 

=> The taxable amount might be less than you have been thinking?

 

Remember also that if the property is in joint names one half of the net rental income will be taxable in your name, so might not be subject to the rate of tax applying to your husband's share.

 

Best regards.

[ItchyFeet76]

Hello I-F.

 

First question: what is your Australian visa status? If you are heading to Aus as the holder of (say) a subclass 457 visa the UK rental income won't be taxable in Australia.

 

In terms of the assessable amount, the interest element of your mortgage repayments is allowable as a tax deduction, as will be any letting agent charges, costs of tenancy agreements, buildings insurance, etc.

 

=> The taxable amount might be less than you have been thinking?

 

Remember also that if the property is in joint names one half of the net rental income will be taxable in your name, so might not be subject to the rate of tax applying to your husband's share.

 

Best regards.

 

Hi Alan,

 

Thanks for your reply. Yes, it would be on a 457 visa, so it's good news that we won't have to include it on our Aus tax return, at least! Here's a quick calculation that I've done, taking into account our potential rental income, interest-only mortgage payment, etc. I've halved everything (half for my tax return, half for my husband's). I don't work - not that I think that alters the finances in any way...? - and I've googled the personal allowance, so I assume anything below our individual personal allowances is not taxable...?

 

NB: I've had to show it for just one of us (so basically these figures are only half the actual figures, i.e. rent is 2 x £475 = £950), as the silly computer kept misaligning the columns and both our sets of figures were showing as one line. Apologies if it's rather hard to read - this is the best I could do...

 

Annual rental income: £475 x 12 = £5700

 

Take away:-

Annual int. only mortgage: £50 x 12 = £600

Annual personal allowance: £9440

Annual agents’ fees: £50 x 12 = £600

Annual building insurance: £5 x 12 = £60

Total to offset: £10700

Minus rental income: £5700

Balance (profit): £5000

 

I've estimated the Landlord's insurance so no idea if it's under- or over-budget, but if it's more expensive then that's a good thing as it'll mean more to offset for tax!

 

On a different tack, how much do you charge to complete an Aus tax return? I understand that even non self-employed persons have to complete one...?

 

Thanks again,

 

I-F :-)

Edited October 15, 2013 by ItchyFeet76
Misaligned text and figures

[Alan Collett]

Hello again I-F.

 

Please feel able to complete the details here if you'd like to have a chat about how we might help:

http://www.gmtax.com.au/contact/

 

Or telephone me at our Melbourne office, on 03 9935 2929.

 

Best regards.

[ItchyFeet76]

Hi Alan,

 

We're not in Oz yet and not even 100% sure it's going to be happen (we won't start job-hunting until next year as we're not ready yet). Do you not have a ballpark price for completing an Aus tax return? Also, does my calculation look roughly correct (in terms of what to offset and the fact that - if the figures are right - we won't pay any tax)...?

 

Thanks,

 

Itchy-Feet

 

Hello again I-F.

 

Please feel able to complete the details here if you'd like to have a chat about how we might help:

http://www.gmtax.com.au/contact/

 

Or telephone me at our Melbourne office, on 03 9935 2929.

 

Best regards.

[Alan Collett]

Hi Alan,

 

We're not in Oz yet and not even 100% sure it's going to be happen (we won't start job-hunting until next year as we're not ready yet). Do you not have a ballpark price for completing an Aus tax return? Also, does my calculation look roughly correct (in terms of what to offset and the fact that - if the figures are right - we won't pay any tax)...?

 

Thanks,

 

Itchy-Feet

 

 

Hello I-F.

 

Very happy to advise fees after an initial phone conversation - you being in the UK isn't a problem as I speak with clients and enquirers in the UK regularly.

 

Best regards.

[Debz101]

I've got myself a bit confused here......

 

I have a form to fill in regarding foreign income, can someone tell me if my calculations for the declaration are correct please?

 

per annum.......

Rent - £9000

 

Agents fees - £900

Mortgage (interest only) - £4668

Life insurance - £420

Landlord insurance - £282

Total outgoings - £ 6270

 

Am I right to assume that the income from the house will only be £2730 to be split 50/50 with the other half?

[Rupert]

I don't see why your life insurance would be chargeable, that is covering your capital, nothing to do with your business of renting out a property. But otherwise, yes

[Debz101]

I don't see why your life insurance would be chargeable, that is covering your capital, nothing to do with your business of renting out a property. But otherwise, yes

 

Thank you.... Added the Life insurance as it was with my UK house paper work, took it out at the same time we changed the mortgage, as it has worldwide cover.