Have Tax Questions? Ask a Tax Expert for Answers ASAP
Hi.Q1 If you haven't registered for self-assessment, you should do so as soon as possible using a form SA1. You will note that if you select that you have a let property as your reason for registering, it asks for a date from which the property has been let. You cannot expect HMRC to let you off the hook for periods prior to your having a new tenant simply because you didn't register for self-assessment.Take a look at the notes on the non-resident landlord scheme here which directly affect you. Q2 Assuming that you are a UK citizen and the figure of £13,250 is your rental profit after deduction of allowable expenses and rental losses brought forward, if there are any, you will be entitled to the personal allowance which is £10,000 for 2014/15 so you would pay tax at 20% on £3,250 which is £650.00.Q3 The service charge will come off your rental income, not your tax. An expense of £1,250 will reduce your tax liability by £250.00 (20%).Q4 If you left the UK by 5 April 2013, any assets owned by you before you left and which you sell whilst living abroad, will be exempt from UK Capital Gains Tax so long as you complete five full tax years as a non-UK resident. The five full tax year period would have started on the first 6 April after you left the UK, assuming that was by 5 April 2013. If you return to the UK before the five full tax year period is completed, gains on any assets you held before you left the UK and which you sold whilst abroad, would be subject to UK CGT in the tax year of your return to the UK. Q5 See the answer to Q4. There have been two rates of CGT in the UK since the summer of 2010, 18% and 28% with the first £11,000 of gains being exempt. The rate or combination of rates that you pay will be dependent on the sum total of your income and gains in the tax year. You may have to pay CGT in the country that you live in but that depends where you live and you should take local advice on that.Finally, it is the UK government's intention to tax the gains made by non-UK residents when they sell UK residential property with effect from 6 April 2015. However, it is expected that only the gain which accrues from 6 April 2015 to the date of sale will be taxed. That will mean that the property will need to be valued as at 5 April 2015 as that value will become the new cost for UK CGT purposes.I hope this helps but let me know if you have any further questions.