Rental income - taxed abroad?

HarryGray

Hi all, Sorry if this is the wrong place for this. I have a few Buy-to-Lets owned through my LTD company and they generate about £1,800 per month after expenses/management fees/Interest only mortgage. At the moment its simple as the profit is just taxed as corporation tax and I dont take anything out of the company. 

However do you know how this will be taxed if I move abroad to Canada? My company I assume will remain a UK company so would be liable for corporation tax in the UK. But what if I took money from the company as dividends?

I may speak to a tax adviser but for this amount of monies I thought I would see if anyone has had similar problems on this forum first.

Thanks

joeistheone

Definitely get a Canadian tax advisor  but: (1) the UK will continue to tax the company profits (2) the dividends shouldn't be taxed in the UK if you are non-UK resident but Canada would probably tax them since you would be tax resident there. 

PRAISETHESUN

UK-derived income will be taxed in the UK. If you end up becoming a Canadian tax resident usually you'll also need to declare it on any Canadian returns you file as well and will count towards your taxable Canadian income, but you should be able to claim tax relief through a tax treaty: https://www.gov.uk/government/publications/canada-tax-treaties

I have to worry about this from time to time for some Australian tax stuff and basically I pay tax in Australia and claim relief for it in the UK. As the tax rates for this is slightly higher in the UK I still end up owing money to HMRC but it's not as if I'm getting taxed twice for a single income stream. Depending on how complicated your arrangements are, I'd definitely advise getting professional advice on this.