orangetree
28-07-2010, 13:52 PM
Hi, this is probably so common that you all think I'm a dimwit, but I'm completely new to all this and could do with some "Janet & John" advice so that I get everything done correctly and understand it all thoroughly before I go down this route.
Due to some opportunities that have arisen, me and my husband are planning on moving back to my home country (Australia) and will rent our house out here (in order to have fall back if it doesn't work out there - there's not enough equity in it to make it worthwhile selling anyway). Rental income is likely to be about £750, with our mortgage currently paying £780 (interest only at the moment, which I'm loathed about), so there will certainly be no profit after the management fee is taken out. Mortgage company have already given permission to rent it out with no requirement to change the product itself until the fixed rate is up.
I know I need to register all this with the tax office etc, but what exactly am I doing here? I assume - in theory - income on the self-assessment form is £750, with management fee and mortgage interest payment ALL becoming allowable expenses, ie no profit, therefore no tax. We would of course have to filter more money through from overseas to top up and for any other expenses, which won't be a problem in itself and I guess won't need to be taxable as income (as it's simply a transfer from our Aus account to our UK account). However, how does all this relate to me and hubby? Who declares it? Hubby is already registered self employed and I'm not (until I notify tax office of course), but the mortgage and bank account where money will collect are in both names, so who fills in the tax forms and thus declares the income...? We'll be having to do self-assessments in Australia too, but we'll deal with that side of things when we get there.
Any advice would be greatly appreciated. I'm a smart woman but I feel a right numbskull on this! :o
Due to some opportunities that have arisen, me and my husband are planning on moving back to my home country (Australia) and will rent our house out here (in order to have fall back if it doesn't work out there - there's not enough equity in it to make it worthwhile selling anyway). Rental income is likely to be about £750, with our mortgage currently paying £780 (interest only at the moment, which I'm loathed about), so there will certainly be no profit after the management fee is taken out. Mortgage company have already given permission to rent it out with no requirement to change the product itself until the fixed rate is up.
I know I need to register all this with the tax office etc, but what exactly am I doing here? I assume - in theory - income on the self-assessment form is £750, with management fee and mortgage interest payment ALL becoming allowable expenses, ie no profit, therefore no tax. We would of course have to filter more money through from overseas to top up and for any other expenses, which won't be a problem in itself and I guess won't need to be taxable as income (as it's simply a transfer from our Aus account to our UK account). However, how does all this relate to me and hubby? Who declares it? Hubby is already registered self employed and I'm not (until I notify tax office of course), but the mortgage and bank account where money will collect are in both names, so who fills in the tax forms and thus declares the income...? We'll be having to do self-assessments in Australia too, but we'll deal with that side of things when we get there.
Any advice would be greatly appreciated. I'm a smart woman but I feel a right numbskull on this! :o