Moving to Australia - Sell or let our house?

Angela_D_3

Salemicus said:

Another way of looking at it is this - if you didn't already own the house in Edinburgh, would you be taking out a larger mortgage on the Australian house to buy such a property to let it out?

Sell.

There are also lots of tax advantages in Australia that don’t apply in the UK,  negative gearing,  all sorts.  It’s a !!!!!! storm in terms of making property affordable to those getting on the ladder.  But if you can save 20% deposit you are home and dry quite literally over there 

oldbikebloke

Angela_D_3 said:

Salemicus said:

Another way of looking at it is this - if you didn't already own the house in Edinburgh, would you be taking out a larger mortgage on the Australian house to buy such a property to let it out?

Sell.

There are also lots of tax advantages in Australia that don’t apply in the UK,  negative gearing,  all sorts.  It’s a !!!!!! storm in terms of making property affordable to those getting on the ladder.  But if you can save 20% deposit you are home and dry quite literally over there 

I know nothing about Aus tax, but in respect of UK letting income you will remain subject to income tax on your UK property rental profit under the terms of the double tax treaty. I assume therefore you will not be taxed by Aus on that income, so whatever rules Aus has for calculating profits and claiming relief will not apply to the UK income stream, you will use UK rules for what costs are eligible.
https://www.gov.uk/government/publications/australia-tax-treaties

as dual nationality you will retain your UK income tax personal allowances so you will get some of your profit tax free 

as residents of Aus you will fall under HMRC's non resident landlord (NRL) scheme and therefore it is best if you formally apply for "gross income" status to avoid having your UK agent (or tenant!) have to deduct 20% tax before remitting any money to your account.  https://www.gov.uk/government/collections/non-resident-landlords-forms


BTW as non resident LL you are legally required to provide your tenant with a contact and UK address in the UK at which they can contact somebody who represents you. Obviously the easy solution is to pay a letting agent to do so - vet them to be sure they can cope with it!
If you prefer you do not have to use an agent, it could be a friend or anyone willing to be that contact. Obvious downside is when tenant phones at midnight to say the boiler has stopped, come now and fix it. Friend not too pleased....

uk_american

If your Edinburgh home has appreciated in value from the purchase price, definitely check out the capital gains tax implications. If it's your family home and you sell it today having never rented it out, no problem, no tax. As soon as you rent it out it is now under the CGT tax rules when you decide to sell it and based on the percentage of time that you rented it out vs. lived in it and you'll need to possibly pay CGT if you go above the allowance amount, currently around 12k. Further, the tax rate then would either be 18 or 28% depending on if you are a basic tax payer or higher.

oldbikebloke

uk_american said:

If your Edinburgh home has appreciated in value from the purchase price, definitely check out the capital gains tax implications. If it's your family home and you sell it today having never rented it out, no problem, no tax. As soon as you rent it out it is now under the CGT tax rules when you decide to sell it and based on the percentage of time that you rented it out vs. lived in it and you'll need to possibly pay CGT if you go above the allowance amount, currently around 12k. Further, the tax rate then would either be 18 or 28% depending on if you are a basic tax payer or higher.

in principle yes, but as OP will be non resident there are special rules applicable in that case which can be used to your advantage as you can choose to rebase to a 2015 value, not entire gain over ownership 
https://www.gov.uk/government/publications/non-resident-capital-gains-for-land-and-property-in-the-uk-self-assessment-helpsheet-hs307/non-resident-capital-gains-for-land-and-property-in-the-uk-self-assessment-helpsheet-hs307