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TonyTax
TonyTax, Tax Consultant
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Experience:  Inc Tax, CGT, Corp Tax, IHT, VAT.
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I am a non-resident of the UK. I am due to inherit a small

Customer Question

I am a non-resident of the UK.
I am due to inherit a small property in the UK, probably currently worth just short of GBP 300,000.
I know I fall below the normal Inheritance tax limits, and I understand the basics of Capital Gains Tax should any income, such as rental income, be generated. However, as a non-resident (normally resident in Australia, although I also have UK nationality), are there any different ways in which I might be liable.
Submitted: 10 months ago.
Category: Tax
Expert:  TonyTax replied 10 months ago.
Hi. Let me take a look at this and I'll get back to you.
Expert:  TonyTax replied 10 months ago.
Rental income is subject to income tax in the UK, not capital gains tax. As you are non-UK resident, if you let the property you will need to register with the non-resident landlord scheme which you can read about here. You will be entitled to a personal allowance to offset against any rental profit (income less expenses) you make. Any UK tax you pay will be deductible from your tax liability in Australia on the same income under the terms of the double tax treaty. For CGT purposes, the cost of the property will be its value when you inherit it. CGT is charged on gains from residential property at 18% or 28% or a combination of the two rates depending on the level of your income in the tax year of disposal of the property. Again, any CGT you pay in the UK will be deductible from your tax liability in Australia on the same gain under the terms of the double tax treaty. Look here for information on CGT. If you are UK domiciled, your worldwide estate is liable to UK Inheritance Tax. If you are non-UK domiciled, only your UK based estate will be liable to UK Inhertance Tax. I hope this helps but let me know if you have any further questions.
TonyTax, Tax Consultant
Category: Tax
Satisfied Customers: 15846
Experience: Inc Tax, CGT, Corp Tax, IHT, VAT.
TonyTax and other Tax Specialists are ready to help you
Customer: replied 10 months ago.
Hi Tony,
Thanks for that. Are there any income tax allowances for non-resident individuals, or do I just get the same as a UK resident?
For example, if I were to rent out the property as a non-resident, and earn say GBP 9,000 per year.
Expert:  TonyTax replied 10 months ago.
Are you a UK national or a national of Australia or another country?
Customer: replied 10 months ago.
I have a UK and Australian passport, but am resident permanently in Australia.
Expert:  TonyTax replied 10 months ago.
You should get the personal allowance of £11,000 to use against UK source income if you are UK born or if you are an Australian national. See Box 15 on page RRN4 here.

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