Tax & renting your UK property

[Guest Guest1495]

Does anyone have any tips and advice for tax implications while renting out your UK property from Oz?

 

We would probably be making a little profit of around £100-£200 per month.

 

Our flat is in joint names, and rent would be paid into a joint account.

 

Sharon is currently self employed and has to fill a leaving the uk tax form, which asks about rental income.

 

One property agent who came round said a client had sorted it so he didn't have to pay any tax on his property while in Oz but he wasn't sure how he'd done it.

 

Were going on the 475. Thanks in advance. P

[Andrew from Vista Financial]

Hey Paul & Shaz

 

Holders of a 475 will be classed as holding an eligible temporary resident visa with respect to the ATO.

 

Therefore rental income from overseas investment properties generally does not need to be declared in Australia.

 

British citizens are still entitled to there UK personal allowance approx 6k GBP each person.

 

The UK allows non resident landlords to have rental income paid gross (before tax).

 

So it could mean dependant on other UK income etc rental profit money falls under the UKpersonal allowance hence no tax to pay in UK and may not have to be declared in Australia.

 

I am not a tax Advisor nor am I providing advice but this is my understanding of the situation through research and tax knowledge (also being in a similar situation to yourself recently!!)

 

Hope this helps.

 

Regards

 

Andy

[Guest bentkitty]

Andrew, would this be the same for Permanent Residents? We are moving to Adelaide shortly on a 175 visa and given the property market is pants here in the UK we decided to rent our flat rather than sell it. Thought we would not have to pay tax on the income as it is under the personal allowance limit for the UK (we have no other source of income from the UK). Since we are permanent residents do we need to declare this to Australian tax and pay tax on it??

[Guest batleys]

hi we are currently renting out or house and moved back to mums while visa comes through i currently work for a high street bank in england . Firstly you do not have to have your mtg on a buy to let mortgage if this is your only mtg as they cannot force you, but the will try as they charge you more fees and a higher rate. if you are on a interest only mortgage you are not have to pay tax on this as you are not gaining on this, the small profit you are making i would advise to save this for future expense ie repairs, future expenses when no tennants. You will also need to fill in a nrl1 form which you can down load from inland revenue and submit this, this then entitles you to recieve you rent as gross from your estate agents. Hope this helps, good look pm if you need me but you may want to have a chat with an acountant.

 

475 temp sent 5/6/09 medicals as well

[Andrew from Vista Financial]

Andrew, would this be the same for Permanent Residents? We are moving to Adelaide shortly on a 175 visa and given the property market is pants here in the UK we decided to rent our flat rather than sell it. Thought we would not have to pay tax on the income as it is under the personal allowance limit for the UK (we have no other source of income from the UK). Since we are permanent residents do we need to declare this to Australian tax and pay tax on it??

 

 

 

Sorry I missed your post before, if you are a permanent resident here in Australia, then you will have to declare your worldwide income to Australia which wll then be taxable at your marginal rates.

 

British citizens are able to utilise there UK personal allowance before having to pay UK tax. If you do to pay tax on income in the UK then you should be entitled to a tax credit in Australia due to the dual tax agreement.

 

http://www.ato.gov.au/print.asp?doc=/Content/54558.htm

 

 

Regards

 

Andy