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bigduckontax, Accountant
Category: Tax
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If my wife and I have a rental property in Germany and the

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If my wife and I have a rental property in Germany and the income from which is being taxed by the local German tax office. Do we have to declare anything to the UK HMRC.

Hello, I am Keith, one of the experts on Just Answer, and pleased to ba able to help you with your question.

In which country do you reside, please?

Customer: replied 7 months ago.
Customer: replied 7 months ago.
We reside in the UK

You are taxed on your world wide income so you will have to declare this net rental on your annual self assessment tax returns.

Under the Double Taxation Convention between the UK and Germany, the same income stream cannot be taxed in both jurisdictions. This is achieved by means of tax credits, the tax paid to one country being allowed as a tax credit against liability in the other. Thus you will both have a tax credit from Germany to offset the UK liability.

I do hope that you have found my reply of assistance.

Customer: replied 7 months ago.
I would like to add that the income from the rentals does not come back to the UK but remains in Germany.

That does not matter one iota. You are taxable on your world wide income wherever it is earned or retained.

Customer: replied 7 months ago.
Thanks for your previous answers. One last question: On the sale of a property in Germany which we've had for over ten years would we be liable to capital gain tax.

Yes, unless it were your sole or main domestic residence.

bigduckontax and other Tax Specialists are ready to help you

Thank you for your support.