LittleMissWildChild Posted January 8, 2015 Share Posted January 8, 2015 Sorry if this has been asked before. Hubby has a UK flat, we are living in Oz so he has a tenant. We're thinking of selling it and buying something here. We have been in Oz for just under 2 years. I'm an Aussie citizen, he has PR. 1. He is currently doing UK tax returns for his UK income from his flat (and then mentions it on his OZ tax return). If he sells does he need to pay tax on selling the flat in the UK and then in Oz? Or can he just cut the UK out and declare everything in the UK as he is now PR here? 2. This will sound really stupid but we've never sold a property - how does capital gains work? We have only had a tenant in there from maybe 5 months before we came here. The flat was worth £145K when we left - we got a quote from his letting agent at the time - its now worth £175K now. His mortgage is still £105K. To my understanding he only pays capital gains on the difference between what it was when he left and what it is now, is that right? I read on the NAB website (albeit from 2011) that: 'If you’ve acquired a capital gains tax (CGT) asset after 21 September 1999 and held it for over 12 months before selling it, you should be able to obtain a 50% discount on the capital gain. If you sell an asset less than 12 months after buying it you don’t get the 50% discount and should pay tax on the full capital gain.'. Does that therefore mean if the property sells for £175K (and i understand there are fees etc) and his flat was worth £145K so the diff is £30K if the property was subject to capital gains, it would only be for £15k? And can we split that between us? Our incomes are similar. Sorry for all the stupid questions TIA x Link to comment Share on other sites More sharing options...
octatonic Posted January 8, 2015 Share Posted January 8, 2015 I'd recommend speaking to an accountant. Yes you usually need to declare your income in the UK and then Australia. You will have the income adjusted in one of the countries, depends on where you are resident. You won't pay double the tax- you can apply for tax relief as a nonresident. It is fairly complicated- I can't speak to your specific circumstance as I won't know the full details. Regarding capital gains- if you sell before April 6th this year then you don't pay capital gains in the UK. After that date the UK govt is brining in new rules for capital gains for non-residents. Again, fairly complicated so any advice you are given here may not apply to your specific circumstances. Link to comment Share on other sites More sharing options...
Recommended Posts
Archived
This topic is now archived and is closed to further replies.