# Emmigration Tax Help: Rental property back in the UK



## ChrisNkate (Jan 15, 2012)

Morning

Could anyone help?
We have resident visas in place and will have a property in the uk to rent whilst in Perth, and im trying to find advice on our tax liability whist non resident in the uk.
Does anybody know whether we will be liable to pay tax on the rental income of the property, based on the fact we will be earning under 7000 a year, which currently is exempt, but will we liable to pay VAT on the fees we pay the Agents to manage it.
We did speak to a tax solicitor 2 years ago and unfortunatley mislaid the contact details.
Any help or recomendations please?

Chris


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## Bevdeforges (Nov 16, 2007)

I'm not really an expert on UK taxes, but the general principle is that you pay taxes on income from property in the country where the property is located. In your case, you'd pay taxes on the income from the property in the UK to the UK - probably as non-residents. The VAT that the agents are charging you is based on their performing of services in the UK for you, so I don't think you can get out of that.
Cheers,
Bev


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## siobhanwf (Mar 20, 2009)

Tax on rental income - an overview : Directgov - Money, tax and benefits

Rental collection, management fees and accountancy fees are all deductible. This is the TOTAL of the bill.

It is the duty of the testing agent to collect taxes on behalf of HMRC. You can however apply for self assement status. This is a good idea as it negates the necessity to file and independent claim for any overpayment of deduct able expenses.

If you have the patience to wade through it there is a 68 page guidline here http://www.hmrc.gov.uk/cnr/nrl_guide_notes.pdf


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## snikpoh (Nov 19, 2007)

Bevdeforges said:


> I'm not really an expert on UK taxes, but the general principle is that you pay taxes on income from property in the country where the property is located. In your case, you'd pay taxes on the income from the property in the UK to the UK - probably as non-residents. The VAT that the agents are charging you is based on their performing of services in the UK for you, so I don't think you can get out of that.
> Cheers,
> Bev


You can also ask for any rent to be paid gross with NO UK tax and then declare and pay taxes in your country of residence. 

That is, you do NOT need to pay tax on rental income in UK if you reside elsewhere. Ask your managing agent for the 'green form', fill this in and then make sure that you do declare the income in your country of residence. as they WILL check.


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## PaulAshton (Nov 18, 2011)

There is another way, you can also avoid landlord tax by splitting your rental income in varying ways

To make sure that HM Revenue & Customs don't challenge this way of avoiding landlord tax, it would be wise for you as joint owners to both sign an agreement stating how the rental income will be shared for tax purposes. Try to do this at the beginning of the landlord tax year.

You can always look at and quote *HMRC's Property Income Manual (PIM 1030)* to them if they question your practices to avoid landlord tax. It says that "joint owners can agree a different division of profits and losses and so occasionally the share of profits or losses will be different from the share in the property. The share for tax purposes must be the same as actually agreedHMRC 

..And yes HMRC are snoops they probably will start looking here as they also troll Ebay sellers to ensure they are paying taxes the key is "avoidance" not "evasion" which is illegal..


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## Whiteedd (Jan 18, 2012)

For anyone from the UK are a couple of other things you need to be aware of if you are renting your house in the UK. 
Preferably before you leave, submit a tax form P85 to register that you are out of the UK for tax purposes.
The UK has a tax arrangement with the Aussie tax office which means that you can pay tax on the earnings in Australia (which has more tax breaks)
The rental agent (by law) will deduct tax from your rent and send it to HMRC unless you fill out the (Non-resident landlord)NRL1 form. Go onto the HMRC website and search on NRL1
You will also need to fill in a UK tax return each year even if you declare the income in your Aussie tax return. If, like me, you have a joint mortgage with your partner both of you will have to submit a tax return with the income split between the two returns. 
Unfortunately HMRC does not have the ability to file the supplementary forms that you need to record the income from your house so you either need to:
1.	Put in a paper return
2.	Get an agent to do you return 
3.	Buy a software package which allows you to file your tax online (I got one for 17GBP from Andica). There is a list of software providers on the HMRC website
Sorry I cannot attach the web links at the moment. Hope this helps


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