Selling a UK house when living in New Zealand

Lucy_Jem

My husband and I may have to move to New Zealand in the next couple of years. If we don't' sell our UK house straight away, we would let it out and sell it in the future. So I have two questions:

1. Under most mortgages would be allowed to get the 'right to let' on our residential mortgage very easily? Or would they not accept it since we are moving over seas? Would they force us to move to a buy-to-let on an Expat mortgage?

2. If we sold the house in future would we be charged CGT twice? I can see on the HMRC site that there is INCOME relief where you pay the higher of the two tax rates (either in your resident country or country of income - can't remember which), but it didn't say anything about CGT.

Thanks!

Lucy

G_M

Lucy_Jem wrote: »

My husband and I may have to move to New Zealand in the next couple of years. If we don't' sell our UK house straight away, we would let it out and sell it in the future. So I have two questions:

1. Under most mortgages would be allowed to get the 'right to let' on our residential mortgage very easily? Or would they not accept it since we are moving over seas? Would they force us to move to a buy-to-let on an Expat mortgage?
Depends on the lender. Some lenders never grant CTL, others do. CTL is usually granted where the owner is moving temporarily ( whether overseas or within the UK), but is essentially keeping the property as their home.

If the lender knows it is a permenant move, they'll insist on a BTL mortgage

2. If we sold the house in future would we be charged CGT twice? I can see on the HMRC site that there is INCOME relief where you pay the higher of the two tax rates (either in your resident country or country of income - can't remember which), but it didn't say anything about CGT.

Thanks!

Lucy

Do you mean would you pay CGT in the UK and in NZ? You'd need to check NZ tax law, and also ask HMRC about any reciprical tax arrangement.

Would you employ a letting agent? And/or get tenants to pay direct to your bank? See:

HMRC (Non Resident [= overseas] Landlord Scheme)

and:


* New landlords: advice, information & links

* Letting agents: how should a landlord select or sack?

booksurr

Lucy_Jem wrote: »

My husband and I may have to move to New Zealand in the next couple of years. If we don't' sell our UK house straight away, we would let it out and sell it in the future. So I have two questions:

2. If we sold the house in future would we be charged CGT twice? I can see on the HMRC site that there is INCOME relief where you pay the higher of the two tax rates (either in your resident country or country of income - can't remember which), but it didn't say anything about CGT.

under the terms of the UK/NZ tax treaty you would not be charged twice, you are liable under UK tax only: article 14 para 1 https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/446864/1983_New_Zealand_UK_as_amended_in_2007.pdf

however, CGT rules changed wef April 2015 in respect of your UK calculation

• if you are non resident and sell the property after that date you are liable to CGT on the gain between 6 April 2015 to date of sale
  
• if you moved to NZ after 6 April 2015 you would continue to receive private residence releif betweem April 15 to the date you left.
  
• you would also get the usual final 18 months of ownership as PRR relief under the normal rules given it was once your main home
  
• on that basis you would also be able to claim letting relif of up to £40k (for each owner)
  
• each owner will also get their personal allowance despite being non resident

Unless your house is worth millions I doubt you will end up having to pay any CGT

see https://www.gov.uk/guidance/capital-gains-tax-for-non-residents-uk-residential-property