UK Resident, Australian rental property

JJH1969

I have a UK res, dom and OR who owns an Australian Property which is being let. Australia have different capital allowances to us here in the UK and as a result she has not paid Australian tax on the rental. I have advised (although she doesnt want to do this) that she should add the property to her UK SA100. How do I treat the depreciation - do I just use UK rules and as such she will have tax to pay?

villapb

A uk resident will be taxable on property income from property within and outside the uk.
Capital expenditure on let properties is not deductible.
Capital expenditure on furniture is on the renewal basis and wear and tear allowance is used because its simpler.
Capital allowance on plant and machinery to maintain
or repair properties is allowed using AIA ETC.....
If the landlord can also claim the energy saving allowance if has insulation etc expenditure......

reader

JJH1969 wrote: »

I have a UK res, dom and OR who owns an Australian Property which is being let. Australia have different capital allowances to us here in the UK and as a result she has not paid Australian tax on the rental. I have advised (although she doesnt want to do this) that she should add the property to her UK SA100. How do I treat the depreciation - do I just use UK rules and as such she will have tax to pay?

My understanding is that if you are completing a UK tax return then you would use UK tax rules, i.e. depreciation would not be allowable. Presumably if the property is fully furnished she would qualify for the 10% wear and tear allowance (in order to account for any fixtures and fittings). It sounds like she/you need to complete the foreign pages of the SA100.