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taxadvisor.uk
taxadvisor.uk, Chartered Certified Accountant
Category: Tax
Satisfied Customers: 4996
Experience:  FCCA - over 35 years experience as a qualified accountant (UK based Practitioner)
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I live overseas and do not pay UK tax. I have a flat in London

Resolved Question:

I live overseas and do not pay UK tax. I have a flat in London which is rented. Do I need to pay tax on the income? Thx.
Submitted: 3 years ago.
Category: Tax
Expert:  taxadvisor.uk replied 3 years ago.
Hello and welcome to the site. Thank you for your question.

Property income arising from property in the UK is chargeable to UK income tax.
Are you a UK national .. if so, you would be entiltled to personal allowance against that income. If the profit is less than £10,000 (personal allowance for tax year 2014-15) then there will be no tax payable.

More information on who is entitled to UK tax personal allowance is covered here

http://www.hmrc.gov.uk/manuals/rdrmmanual/rdrm10340.htm

I hope this is helpful and answers your question.

If you have any other questions, please ask me before you rate my service – I’ll be happy to respond.

Customer: replied 3 years ago.

Many thanks. The property is owned by a company registered in the British Virgin Islands of which I am the sole owner and director. I bought the property 6 years ago while overseas and it's value has doubled from 1m to approx 2m-2.2m. I am planning to return to the UK next year and spend more that half the year there.


 


 


1. If I subsequently sell it after I return would it be subject to Capital Gains Tax.


 


2. Would it make more sense to transfer the property into my personal name before I return?


 


Thx again.

Expert:  taxadvisor.uk replied 3 years ago.
John, thank you for your reply.

If you sell the property after return to the UK and funds are remitted to the UK, they would be subject to UK taxation.

If the property is transferred into your name before you return, then your gain would be based on difference between transfer price and eventual sale price.

I hope this is helpful.
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