tax on mortgage paid rental property?

[huxwar]

hi,

i currently rent out my house which the mortgage is paid off.

will i get stung for CGT or income tax?

[subjecttocontract]

Do you live in the house as well or do you own another somewhere else ?

[TaxationPete]

Well there will be an IT liability on the rental income after deductible costs, repairs etc. and Depending how long tyou have owned it prior to after you started renting it out there may be some CGT read IR283 on the HMRC web site. In practice if the property was your home and qualified as your PPR then the PPR relief and letting relief could keep the property free of CGT for 5,6,7 or even more years depending on what house prices do in the future and when you sell it. Regards Peter

[huxwar]

the house was my primary residence but moved into hm forces accomodation because i was sick of the daily commute. i had owned and lived in it for about 2 years prior to moving into military housing of which i rent.

thanks for your reply taxation pete

[TaxationPete]

Did you live in the property when you were moved to different barracks. Members of the armed forced and certain Crown Servants can be exempt from the 36 months limit and PPR is granted indefinitely depending on the facts. Regards Peter

[huxwar]

i was in the house when i got moved barracks, although i decided to commute for the first year before moving into service accomodation because i got sick of the drive.

[TaxationPete]

Good News. Your property is deemd to be your PPR as you are a serving military officer and it will remain so until you either leave the service or purchase another property as your home. Regards Peter

[huxwar]

many thanks for your info peter, does that mean i do nothing or do i have to declare this somehow?

rgds hux

[TaxationPete]

If you speak to HR they should point you in the right direction. This is a common problem. Regards Peter

[nicoleima]

no capital gains tax until you sell the property
if it is your principal residence (home) then you pay 0% tax.

[TaxationPete]

He is a serving crown servant and is allowed to hold a UK property for as long as he remains in service and it be treated as his PPR. Regards Peter

[huxwar]

how do i portray i am a current serving military officer onto an online tax return and the rental house is my PPR?

am i completely exempt any tax?

[Telometer]

You are only exempt CGT. You have to pay income tax on the rental income if you are a UK resident.

[jeffrey]

You are only exempt CGT. You have to pay income tax on the rental income if you are a UK resident.
Let's rephrase that as You have to pay income tax on the profit element of the rental income, whether or not you are a UK resident.

[Telometer]

We could rephrase that too!