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taxadvisor.uk, Chartered Certified Accountant
Category: UK Tax
Satisfied Customers: 4720
Experience:  FCCA - over 35 years experience as a qualified accountant (UK based Practitioner)
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If someone owns own-to-let property in the USA and is deriving

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If someone owns own-to-let property in the USA and is deriving income from it they obviously have to declare that income in the US and pay taxes on it. If that person then moves to the UK they of course have to declare that rental income when self-assessing. That means they have paid taxes twice on the same income. I know that foreign taxes paid can be used as a foreign tax credit for earned income but what about passive income like investment properties? It would seem unfair to have to pay taxes twice on the same income stream.
Hello, if you have any questions or need further clarification after reading my answer please let me know.
Customer: replied 3 years ago.

Hello. I believe you forgot to answer the question. Please do so.


 


thanks,


 


Howard

You can claim credit for foreign tax paid on rental income and other investment income when completing your UK Tax return. You have to complete supplementary pages SA106 - Foreign and show tax suffered on that income.

More information on this can be found here

http://search2.hmrc.gov.uk/kb5/hmrc/forms/view.page?record=EZbpjD2hV2M&formId=3188

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