Q. In the year I leave the UK am I entitled to a tax refund?
A. Depending on the date of your departure most individuals are entitled to a refund of UK tax (assuming you have paid tax throughout the year). A refund arises because you are entitled to UK personal allowances for the full year, even though you have only been resident in the UK for a part year.
Q. How do I claim a tax refund when I leave the UK?
A. If you are not in the UK Self Assessment system you should complete a form P85 and send this to HM Revenue and Customs in the UK with the P45 from your last employer. This form can be sent to HM Revenue after you have departed the UK.
If you are in the UK Self Assessment system your tax refund can be claimed when you lodge the UK tax return for the tax year in which you leave the UK.
Q. What happens if I decide to rent out a property in the UK when I move overseas?
A. You will probably have to complete a UK Tax Return and report the rental income received less any expenses for the tax period 6 April to the following 5 April, and pay UK tax accordingly.
As a UK citizen you remain entitled to a UK personal allowance, even if you are not resident in the UK.
You should also complete and submit a UK Revenue form NRL1 in your capacity as a non-UK resident landlord.
Q. What rate of income tax will I pay on my UK rental income?
A. As a UK citizen you are entitled to a personal allowance, which (for 2013/14) will exempt the first £9,440 of income from UK tax.
If your the net rental income from your UK property is above £9,440 you will pay income tax at the usual rates paid by UK residents.
Q. Do I pay additional tax as an expat on income from UK investments? (i.e.: Endowments/PEPs/TESSAs/ISAs)
A. Probably not – but you should check this with a tax advisor who deals with the tax regime in the jurisdiction in which you are living.
You should also discuss your investments with a financial planner in the jurisdiction in which you are living, as your financial position may be significantly improved by investing in a different jurisdiction.
Q. Do I have to complete a Tax Return in Australia?
A. If you are a tax resident of Australia – yes.
If you are not a tax resident of Australia – probably not, though it is best practice to submit a Non Lodgment Advice with the Australian Taxation Office.
Tax Returns are to be submitted to the Australian Taxation Office by 31st October following the end of the tax year, unless a Registered Tax Agent is engaged. Registered Tax Agents are permitted to submit tax returns for clients for several months beyond the 31st October deadline.
Q. Are you a Registered Tax Agent?
A. Yes, we are. Our agent number is 5153 1008.
Q. What income should I include on my Australian tax return if I am a non resident of Australia?
A. Non residents are subject to Australian tax on rental income from a property that is located in Australia.
Interest and dividend income is generally subject to withholding tax, which might be creditable in the country in which you are now residing. There is no additional tax payable in Australia on such sources, and they are not included on an Australian tax return once you have ceased to be a resident of Australia.
Q. And what rate of tax will I pay as a non resident of Australia on my Australian source income?
A. For non residents the first $80,000 of assessable income is taxable at 32.5%. The rates of income tax for non residents whose income is above $80,000 follow those for residents of Australia: 37% on the next $100,000 of income, and 45% on assessable income above $180.000.
Q. When do I stop being a tax resident of Australia?
A. There are several tests which the Australian Taxation Office applies, but as a broad guide if you spend more than 2 years living and working outside Australia you can reasonably consider yourself to have ceased to be a tax resident of Australia.
If the time you live and work outside Australia is less than 2 years you will continue to be a tax resident of Australia, unless you can show that your permanent place of abode is outside Australia.