Tax on UK rental income

 Can no one help this poor guy? I have the same question. 

Hi Acapulco,

From doing some digging around and speaking to people, it looks like I would have to pay tax on my UK rental income in the UK, not in Spain.   Once you join the Non-resident Landlord Scheme with HMRC, the letting agent will not deduct tax from the rental income.  HRMC will then make a decision as to whether or not we will need to complete a tax return.  Because we are only likely to make a small profit after fees, mortgage interest etc and because we can take in to account our UK personal tax allowances, it is unlikely that we will be asked to fill in a UK tax return.  

As far as the Spanish side of things are concerned, because of the double taxation agreement, we would not be liable to pay any tax in Spain on our UK rental income.

I may be wrong, but that was my interpretation. 

If you find out otherwise, let me know.

Cheers

David

Hello,

As far as I'm aware you cannot deduct expenses from your rental income for tax purposes. We do not actually have an advice page on this yet on the website I link to below, but this is  something that will be coming shortly.

Rental income tax is 25 per cent of gross income if you are non-resident (correct as of March this year) in Spain.

I am working on some more country specific advice pages, but this is a work in progress so keep checking in!

Hi Bellarina,

Are you talking about rental income from a Spanish property here?

Hi,

Yes I am - were you asking if tax from property in the UK could have expenses deducted? In that case I'm not sure off hand. I know you can apply to have your rental income untaxed in the UK via the Non-Residents Landlord Scheme but as for in Spain I shall try and find out for you.

Yeah, I was talking about tax on my UK property.  I think I've worked out that I won't have any tax liabilities in Spain on my UK property and probably not in the UK either (because I can use my personal tax allowances).

cheers

David

I have read that Spanish tax is 25% of 50% of the rental incom . Does anyone have knowledge of this?

As am retired and have no mortgage I only have my personal allowance which is wiped out by my pension.

Hi Acapulco,

If it's a Spanish property you are renting out, I think you will need to pay tax in Spain, but not sure about the rates   I don't think  your UK  personal allowance could have been used for tax relief on a Spanish property anyway.

David

 Sorry, I did not make it clear. It is a UK property we want to rent out.