getus2oz Posted September 29, 2009 Share Posted September 29, 2009 Please HELP, Off to Perth in the next few months and were not sure what to do with our UK home. Its been up for sale since July,is realistically priced but our local area is stagnant. Can anyone offer any advice about their experiences of renting out their uk home and the tax implications etc. or a simple checklist of things to do ? We have a low-ish mortgage but because the low £/AUD we are considering : 1/ switch to interest only mortgage, leave house empty, inform insurance, get relatives to mow grass etc. and hope for a sale asap. 2/ rent it out on a 6 month contract and pay relevant tax's (not sure % or where to get information from) and agent fees, then tidy it up again and sell. Feel like were going around in circles at moment and running out of time. Thanks for any info xjo Link to comment Share on other sites More sharing options...
NTH SHARMAN Posted September 30, 2009 Share Posted September 30, 2009 It's a killer ain't it??? We went with option 1. Only difference was that we took a mortgage break for a year and hoped for a quick sale. If you are planning on doing this, then a couple of points to bear in mind. You must make sure that your agents do not tell potential buyers that you have left the country. Make up some convincing story and get them to stick to it. Once the cat is out of the bag, the vultures start to circle. Also, instruct a Solicitor and grant Power of Attorney to a nominated person. This allows someone else to sign contracts, etc, when a sale is negotiated. Even better is to instruct a Solicitor to deal with the eventual sale of your house, and nominate a Partner there to have Power of Attorney. You need one nominated person per mortgagee. Lastly, be prepared for the fact that it can become very stressful. It took almost a year for our house to finally sell. I'm not sure about the renting option because this was something we never really looked into. Sometimes wish we had. I'm sure I read somewhere though that you have to change your mortgage to a buy to let one. Hope it works out for you whatever you decide to do. T xx Link to comment Share on other sites More sharing options...
oldgit Posted September 30, 2009 Share Posted September 30, 2009 Hi Jo, We were fortunate enough to have two houses in the UK. Our family home and our so called investment property. We managed to sell the family home for a good price which has kept us afloat over here. We did toy with the idea of keeping the investment property empty until the UK market picked up as we didn't like the idea of not being able to drive by and keep an eye on it. Then reality kicked in if the house was left empty it would just slowly chip away at our savings it's not a good idea to keep a house empty for too long you will eventually have to pay Council tax for the property. We enlisted an agent and gave a strict criteria of the sort of people that would be able to rent our house. The money gets paid into our UK bank account without tax deducted. You can sort this out with the UK tax office (non-resident landlord) You can download the forms from www.hmrc.gov.uk/cnr We are of the opinion that our house is best off being rented out until the market picks up and the exchange rate hopefully goes up. Best of luck The oldgit Link to comment Share on other sites More sharing options...
oldgit Posted September 30, 2009 Share Posted September 30, 2009 Hi Jo I forgot to mention that although rent is free of tax in the UK we still have to declare it as overseas income on our tax return in Australia Link to comment Share on other sites More sharing options...
Guest lizzy1 Posted September 30, 2009 Share Posted September 30, 2009 Hi Oldgit, we are currently considering the option of renting our home but not sure how this will work out. We won't be making much of a profit because of all the associated expenses. So for tax purposes does the tax department take into account expenses and if so which ones? Thanks for any info. Lizz Link to comment Share on other sites More sharing options...
oldgit Posted September 30, 2009 Share Posted September 30, 2009 Hi Oldgit, we are currently considering the option of renting our home but not sure how this will work out. We won't be making much of a profit because of all the associated expenses. So for tax purposes does the tax department take into account expenses and if so which ones? Thanks for any info. Lizz Sorry Lizzy, I'm no expert on these matters so I will have to let someone else on here answer that for you. Link to comment Share on other sites More sharing options...
getus2oz Posted October 1, 2009 Author Share Posted October 1, 2009 Thanks for replies so far, I've checked with my mortgage provider and will need to complete a letting pack (£100) but we don't need to switch to a buy to let mortgage, also been thinking of changing mortgage to a offset so we can draw some money out if needed - any thoughts on this would be great. x jo Link to comment Share on other sites More sharing options...
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