Tax Rate in AUS when renting out UK property?

[GetMeDownUnder]

Hi,

I have researched as much as I can but I was unsure on the rate so hoped that somebody could clarify.

We are in Sydney on Permanent Residency.

We are renting out our home in the UK (mortgage = interest + repayment).

I am sure we need to complete the NR1 form to ensure that tax is not withheld by the letting agent.

We will be under the tax threshold for 2015/16 as the rental will be our only income.

I understand that we will therefore have to declare the income in AUS and pay tax on the profit (e.g. not tax on the interest, agency fees etc).

Am I really going to have to pay 37% tax (if my earning is 80k+) or 32% (if earning is less) on the profit?

 

Thanks to anybody who can clarify.

[Alan Collett]

Am I really going to have to pay 37% tax (if my earning is 80k+) or 32% (if earning is less) on the profit?

 

=> Yes, additional income over and above your salary will be taxed at your marginal rate of income tax in Australia.

 

Have you obtained a tax depreciation report for the property, prepared in accordance with Australia's tax rules? This should achieve a reduction of your assessable income - maybe even a loss which can be negatively geared.

 

Best regards.