United Kingdom: Worked Example of Tax on Rent
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Tax Example: Rent
| NON-RESIDENT COUPLE (FROM AN EU/ COMMONWEALTH TERRITORY) | ||||
| Non-resident couple's joint monthly rental income1 | 1,500 | 6,000 | 12,000 | |
| Annual Rental Income | 18,000 | 72,000 | 144,000 | |
| Less Personal Allowance2 | (14,904) | (14,904) | (14,904) | |
| Less Costs3 | (4,054) | (16,270) | (32,830) | |
| Less Depreciation4 | (1,800) | (7,200) | (14,400) | |
| = Taxable Income | | 33,626 | 81,866 | |
| Income Tax Rates | ||||
| Up to GBP2,150 | 10% | | 636 | 636 |
| GBP2,150 GBP33,300 | 22% | | 5,998 | 16,610 |
| Over GBP33,300 | 40% | | | |
| Annual Income Tax Due | | 6,634 | 17,248 | |
| Tax Due as % of Gross Income | nil | 9.21% | 11.98% | |
Thanks to: |
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DISCLAIMER: The information contained above is marketing material only and is not written tax advice directed at the particular facts and circumstances of any person and should not be relied upon. We encourage you to discuss your particular situation with us or an independent tax advisor. This information was last updated on March 15, 2007.
Notes
Grant Thornton United Kingdom is a member firm of Grant Thornton International. Grant Thornton International is not a worldwide partnership. Member firms of the international organization are independently owned and operated.
1 The property is jointly owned by husband and wife, but then taxed separately (50% upon each partner). Exchange rate used: 1 = GBP 0.675676.
2 Personal allowance for each taxpayer is GBP5,035 for 2007.
3 Estimated costs. Actually incurred expenses such as letting fees, maintenance and repairs, lawyers fees, professional fees, and building insurance are all deductible.
4 Depreciation is computed as 10% of gross rental income.
| NON-RESIDENT COUPLE (FROM A NON EU/ COMMONWEALTH TERRITORY) | ||||
| Non-resident couple's joint monthly rental income1 | 1,500 | 6,000 | 12,000 | |
| Annual Rental Income | 18,000 | 72,000 | 144,000 | |
| Less Personal Allowance2 | (4,054) | (16,270) | (32,830) | |
| Less Costs3 | (1,800) | (7,200) | (14,400) | |
| = Taxable Income | 12,146 | 48,530 | 96,770 | |
| Income Tax Rates | ||||
| Up to GBP2,150 | 10% | 636 | 636 | 636 |
| GBP2,150 GBP33,300 | 22% | 1,272 | 9,278 | 19,890 |
| Over GBP33,300 | 40% | | | |
| Annual Income Tax Due | 1,908 | 9,914 | 20,526 | |
| Tax Due as % of Gross Income | 10.60% | 13.77% | 14.25% | |
| Thanks to: |
||||
DISCLAIMER: The information contained above is marketing material only and is not written tax advice directed at the particular facts and circumstances of any person and should not be relied upon. We encourage you to discuss your particular situation with us or an independent tax advisor. This information was last updated on March 15, 2007.
Notes
Grant Thornton United Kingdom is a member firm of Grant Thornton International. Grant Thornton International is not a worldwide partnership. Member firms of the international organization are independently owned and operated.
1 The property is jointly owned by husband and wife, but then taxed separately (50% upon each partner). Exchange rate used: 1 = GBP 0.675676.
2 Estimated costs. Actually incurred expenses such as letting fees, maintenance and repairs, lawyers fees, professional fees, and building insurance are all deductible.
3 Depreciation is computed as 10% of gross rental income.
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