Renting property as an ex-pat other

M

mrhogan

Longterm Registered User
Hi there people, I have a question to ask the peers or anyone who has experienced this for themselves.
Due to a recent change in personal circumstances I am now looking to rent a property in the UK for when I am at home between rotations.
My question is one of tax implications and how I will be affected if I am to rent a property as I am almost sure the tax Taliban will be hot on their heels with their hand out!
Many thanks in advance


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Not sure if I understand your question correctly Mr H... but my immediate analysis of your situation is... What or which tax implication/s..?
 
I don't know about income tax, but some areas charge as much as 90% council tax on second homes regardless of how little time you spend there. Its usually tourist areas that do this where there are a large amount of holiday homes in the council district. But it is something you need to look into before you decide where you're going to go.
 
Thanks for your replies folks, it would be my Only place Place of residence in the uk as I do not currently own any properties. My question is as a non domicile person can I rent a property without being spanked by the tax man in any way shape or form. Please excuse my ignorance regarding this.



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I am not sure about your entry requirements or status in the UK..? but for a general rule of thumb..? There is not any tax implication on you renting a primary property in the uk for primary residence no matter how long you spend in that property pro-rata per year... Also, if this is a primary property here within the UK you will be entitled to single occupancy discount where your council tax is concerned..? I believe that it is generally 25% but may change amongst council boundaries...

Trust this helps Mr H and my answer only deals with the property side of your predicament, residency, Income Tax issues etc etc I suspect will be a very different subject...

CD
 
Mr Hogan,
Yes you can rent a property in the UK if you are a non UK resident for tax purposes.

If you want to play straight to the tax man then this should be declared however...

Say your intrest only payments per month are £400 and the rent receieved is £600 then you are only liable for £200 but as you can earn up to £4500 ish without being liable for any income tax then you shouldnt be liable as you will only be earning around £2400 in profit

Also any money you spend on the property ie landlords insurance, repairs , letting agent fees you can off set against any tax that you are liable for.
I use an accountant for my tax returns and still havent paid tax yet for a number of rentals.
 
Cbev said:
Carl,
You have me thinking now I have always been led to believe that any rental recieved is liable to income tax and any profit from the sale of any non residential property is liable for capital gains.
[URL="http://www.which.co.uk/money/tax/guides/tax-on-property-and-rental-income/how-rental-income-is-taxed/"][url]http://www.which.co.uk/money/tax/guides/tax-on-property-and-rental-income/how-rental-income-is-taxed/[/URL][/URL]
Click to expand...

Hi CBEV, You are absolutely right, I got that wrong..! I was thinking of something else so my apologies... a lot on my plate today... that is why I removed it and decided not to post because there is some confusion as to whether or not he wants to just rent or rent out...

The PA does go up sometime this year to around 7000 and the IR do treat rents as earned income but I am not so sure that it is always as straight forward as that with them... but that isn't to say that your post is not correct.

Trust you accept my apology... CD

You are correct...
 
Gents and Lady;
Many thanks for all of your input on this one, your information supplied amongst yourselves has clarified a few points!!

Many thanks
 
If you are referring to renting out to another party, you should declare this UK based income.

Ifd however you are looking at renting a place for yourself to stay between rotations, you need to be very careful as it may affect your residency status and thus tax position.

The 90 day rule no longer applies.

If the tax man can demonstrate that you have ties to the UK like domestic utility bills, property etc, then you may not be classed as a non resident and therefore could be subject to pay tax on your overseas earnings.
 
Dear All,

A property man's perspective.

1. You should always declare income on rental property to the tax man, BUT you can be smart in doing so. All expenses, including the interest only portion of the mortgage come off income. This includes insurance, gas safe, epcs, management fees etc etc. You can also take 10% wear and tear off if the place is rented furnished. If you are long term expat then you can complete an NRL1 (non resident landlords) form which will allow you to apply for tax exemption from lettings income.

2. You will only pay capital gains on selling if it is not your first/ primary property. You still retain the primary property allowance even if working overseas.

Hope this helps.

Andy
 
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