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taxadvisor.uk, Chartered Certified Accountant
Category: UK Tax
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Experience:  FCCA - over 35 years experience as a qualified accountant (UK based Practitioner)
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Hello, I am a Russian national, living in United Arab Emirates.

This answer was rated:

Hello,

I am a Russian national, living in United Arab Emirates. I want to buy a property in the UK. Will I be liable for tax if I rent the property on monthly basis? If so, then how much.

Also, if I sell the property at a higher price, will I need to pay capital gains tax? How much, and if I sell it within which period?

This will be my first property in UK.

Thanks,

Alessia
Hello and welcome to the site.

Alessia, thank you for your question.

Rental income is chargeable to income tax. The basic rate of tax is 20%

Your rental income less allowable expenses to do with repairs/maintenance/agents fee etc will give you profit from property income. This profit and not the gross rental income would be chargeable to income tax.

If you were to sell the property and made a gain from sale of it, then capital gain would be chargeable to capital gains tax. The CGT rate is 18%, 28% or a combination of both depending on your taxable income in the UK in the year of sale.

I hope this is helpful and answers your question.

If you have any other questions, please ask me before you rate my service – I’ll be happy to respond.

Customer: replied 3 years ago.

Thank you for the answer.


 


Just to clarify, as a Russian citizen, there is no problem with me buying a property in UK?


 


Also, if I just use it for my own residential purposes (when I visit) - do I need to pay any tax?


 


I heard that if I sell the property after 1 year, with a profit, then I do not need to pay any CGT? Is it the case?


 


Thanks,


 


Alessia

Alessia, thank you for your reply.

There is no problem as a Russian citizen in buying a property in the UK. There are many Russians who have bought properties in this country.

You pay income tax on profits from property income. If you reside in the property yourself, then there is no rental income and therefore no income tax.

If you have a property that is your second home/holiday home and not your main residence, then all gains are chargeable to capital gains tax irrespective of length of ownership.

I hope this is helpful and answers your question.

If you have any other questions, please ask me before you rate my service – I’ll be happy to respond.

taxadvisor.uk and other UK Tax Specialists are ready to help you

Hello Alessia

I notice you have viewed my response to your original question on income tax and capital gains tax implication of buying a property in the UK (JACUSTOMER-foojy950- Last Viewed on 9/25/2013 at 8:11 AM).

Just checking to see if you have any issues relating to your question that I may not have addressed. Please let me know if I can be of further assistance.

If you are happy and there are no more issues I will appreciate if you would kindly rate the service I provided to ensure I get paid for it.

Alessia, thank you for accepting my answer.

Best wishes.