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Posted Thu, 18 Jan 2024 13:32:49 GMT by
I am a UK resident and EEA citizen. I have been living and working in the UK for 11 years, but I consider myself as non UK domiciled. For year 2022/2023 I have an overseas gross rental income of £2,150 (annual value). The overseas income was taxed in the EEA country, but it has not been remitted in the UK. My employment gross income in the UK is taxed at the basic rate of 20% (PAYE) after the tax-free personal allowance of £12,570. Am I eligible for the property income allowance of £1,000? If yes, then the taxable overseas property income will be £2,150 - £1,000 = £1,150. If I am correct, the tax is calculated in the net profit of overseas rental income, therefore the UK tax will be £230 = £1,150 x 20%. However, the amount of the UK tax (£230) is much lower than the tax I have already paid in my country. Claiming the Foreign Tax Credit Relief covers the UK tax. Does that mean that I am not liable for a UK Tax? Do I still have to declare the overseas gross rental income in the UK filling a self assessment tax return? What actions should I take moving forward?
Posted Mon, 22 Jan 2024 12:42:14 GMT by HMRC Admin 19 Response
Hi,

As you are in receipt of overseas rental income, you are required to declare this in your Self Assessment tax return, to which you may then claim Foreign Tax Credit Relief against any tax deducted overseas on such income within the SA106 Foreign income supplementary page.

Thank you.

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