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Tax on Renting out our UK home


Guest The Sowters

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Guest The Sowters

We have now given up trying to sell our house and have decided to rent it out. Fingers crossed we have tenants moving in in January and then we are off to Adelaide. Can anyone please give any advice on the tax position etc. I have read the tax office website and believe we may be eligble to receive rental tax free but as usual it is all tax office jargen it does't make it clear. Has anyone does this. Any help would be appreciated. Thanks Mark and Tania:confused:

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Guest guest33730
We have now given up trying to sell our house and have decided to rent it out. Fingers crossed we have tenants moving in in January and then we are off to Adelaide. Can anyone please give any advice on the tax position etc. I have read the tax office website and believe we may be eligble to receive rental tax free but as usual it is all tax office jargen it does't make it clear. Has anyone does this. Any help would be appreciated. Thanks Mark and Tania:confused:

 

Have a look at this link HM Revenue & Customs: The Non-resident Landlords Scheme

basically you need to apply to the IR to get a certificate so that the letting agent doesn't have to deduct tax, however any income you receive will still be liable to UK income tax. You may have some deductions you can claim including mortgage interest, agents fees, repairs etc & you may get a further 10% allowance if the property is furnished.

 

Hope that helps

 

Daniel

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Guest redbrydie10
We have now given up trying to sell our house and have decided to rent it out. Fingers crossed we have tenants moving in in January and then we are off to Adelaide. Can anyone please give any advice on the tax position etc. I have read the tax office website and believe we may be eligble to receive rental tax free but as usual it is all tax office jargen it does't make it clear. Has anyone does this. Any help would be appreciated. Thanks Mark and Tania:confused:

 

Hi Depends on your personal tax circumstances. Basically you are still entitled to your UK personal tax allowance, x 2, if you have 2 taxpayers in the family, if you are not on an expat package, ie, you pay aussie tax if you work here in Oz. You will also need to be aware that if you have not been in your UK house for more that 3 years you will need to pay a percentage of the equity earned when you sell as capital gains, for the period you rent it out. so say you owned it for 2 years and you rent it out for 1, you will have to pay capital gains on half the value ofthe equity, minus your cap gains tax allowances. Of course if you sell at a loss or break even, you won't have a gain to pay tax against!

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  • 4 weeks later...

how has it gone with the rental prospect? We're doing the same, but as we're off in early/mid Jan and hubby has decided all this work needs doing, we're really pushing it, and going to have to leave the house with an estate agent (yikes). Kids start school on 27/Jan in Syd, and hubby starts work on 1st Feb, so it's not even an option for me to fly with kids (thank god!) and leave him to sort out the house. So good and bad respects. Sounds like you're more organised. Do you have somewhere to move to? and have you shipped your stuff already? hope it's going more smoothly than ours is! We're just getting passports sorted now! sheesh!

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