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TonyTax
TonyTax, Tax Consultant
Category: Tax
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Experience:  Inc Tax, CGT, Corp Tax, IHT, VAT.
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Hi, I've just bought a house in Wiltshire that I wish to

Resolved Question:

Hi,
I've just bought a house in Wiltshire that I wish to rent. The income will be around £7,500/year.
Since this is under the 11K threshold do I have to pay tax? I don't have any other income in the UK
Also, I live in Greece right now,(I'm a British citizen), where I don't work but pay some tax as a foreign subject.
But, I'm told by estate agents that I would have to pay tax to the UK Government at 20% as an overseas landlord... Is this correct? (I thought double taxation isn't allowed in the EU). If I declare my new house as my primary residence, do I still have to pay rent tax? What is the best way to proceed?
Submitted: 2 years ago.
Category: Tax
Expert:  TonyTax replied 2 years ago.
Hi.

I'll take a look at your question and post my answer soon. There is a fair amount to get through so please bear with me.
Customer: replied 2 years ago.

OK I'll wait.

Expert:  TonyTax replied 2 years ago.
Hi again.

A property you let out cannot by definition be your principle private residence except in very restricted circumstances where you are sent by your employer to work outside the UK or to another part of the UK too far from your home to commute. You have to occupy the property both before and after your move away, unless your employer moves you elsewhere again.

You will be able to offset certain expenses against your rental income and you can find a good list here.

If you are a British national or you are covered by the criteria on the list here, you will be entitled to the UK personal allowance to offset against your UK source income. As that is £11,000 and your rental income will be £7,500 per annum, you won't have any tax to pay. However, as a non-resident landlord, you should read the notes on the non-resident landlord scheme here. As you won't have any tax to pay, you should apply to have your rents paid without deduction of tax by the letting agent or the tenant before the letting has started.

You may have to complete self-assessment tax returns but if your income is covered by allowances, the tax office may not issue returns. However, it is your responsibility to complete tax returns if you do have a UK tax liability, hence the name self-assessment.

I hope this helps but let me know if you have any further questions.
Customer: replied 2 years ago.

Could you please clarify?

Given that I own a British passport and I live in Greece (EUA) am I entitled to the UK personal allowance? Yes?

Since my only income in the UK is the £7,500 from the proposed rent, which is less than the £11,000 I take it that I don't have to pay any tax at all. Yes?

Do I have to apply somewhere to have my rents paid without deduction of tax, or shouldn't I bother? If yes how? Is there a form ?(number?)

Since my income is less than 11K do I have to complete self-assessment tax returns at all? (I'd rather not)

Expert:  TonyTax replied 2 years ago.

Yes, as explained in my answer.

Yes, as explained in my answer.

If you read the notes on the non-resident landlord scheme which I gave you a link to, they tell you what you need to do. The form you need is NRL1 here. There is a link to this form in the NRL notes which I linked you to in my previous post.

You have to complete tax returns if the tax office issue them to you or you think you may have a tax liability.

Customer: replied 2 years ago.

I have not been asked to complete tax returns and I can't see why I should think I may have a tax liability. I have not received any income at all in the UK for over 3 years now.
But, since I'm now purchasing a property to rent out I may have income in the future.(the £7,500 i mentioned). So would you agree with me that there's no reason to complete a tax returns form?

As far as the NRL1 form, I think there's a problem with the system. I try to download the PDF and have installed all the latest acrobat software but I can't download the form, nor see it.

Expert:  TonyTax replied 2 years ago.
Based on what you have told me, you should not have to complete tax returns. However, you do need to complete and submit the NRL1.

You should be able to print the NRL1 from here.
TonyTax, Tax Consultant
Category: Tax
Satisfied Customers: 15886
Experience: Inc Tax, CGT, Corp Tax, IHT, VAT.
TonyTax and other Tax Specialists are ready to help you
Customer: replied 2 years ago.

OK thanks!

Expert:  TonyTax replied 2 years ago.
Thanks and good uck.

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