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Posted Mon, 22 Jan 2024 09:48:25 GMT by E
Hi, I am submitting my first tax return shortly and just had a few questions before I do so. I have income from forestry (selling timber) abroad; no other foreign income. This activity started on 1/1/2023. Firstly, am I right that I report this as "Income from land and property abroad"? Secondly, can I use the "March 2023 average exchange rates" for eur/gbp to calculate the sum in gbp? And finally, a question about the timing of expenses. As this is my first year of receiving income I don't have an established basis period . In 2023 I had income in the first half of the year and expenses in the second half (and the foreign taxation will be based on the calendar year). Can I deduct these expenses to match the foreign tax year, or should I deduct them in the 2023/24 return instead? And following from the above, if I cannot claim the expenses in 2022/23 then can/should I claim Property income allowance instead?
Posted Wed, 24 Jan 2024 15:49:44 GMT by E
I would appreciate a reply if at all possible! Thank you
Posted Thu, 25 Jan 2024 10:27:22 GMT by HMRC Admin 25
Hi E,
Income from the sale of timber from the ownership of commercial woodlands is exempt from both Income Tax and Corporation Tax - the exemption only applies if the timber cut or felled is not altered or transformed prior to sale profits arising from the occupation of commercial woodlands are not chargeable.
Capital Allowances cannot be claimed on capital expenditure incurred on plant or machinery connected with commercial woodlands.
Note that if the woodland is connected with or attached to an existing farming trade, special consideration will have to be given as to the tax status of the operation.
Relief is not available for:
losses suffered expenditure incurred on the preliminary clearance of woodland of woodland or other preparation of land for forestry purposes.                                                                                                                                                                                                                                                    Further giudance is here:
BIM67701 - Woodlands
Thank you. 
Posted Fri, 26 Jan 2024 08:10:10 GMT by E
Thank you for the reply! I can just confirm that this also applies to overseas commercial woodland. thank you!
Posted Sun, 28 Jan 2024 19:08:04 GMT by E
Hi, I would just like to confirm how this should be reported - does it need to be and under which section should it be listed? Thank you
Posted Tue, 30 Jan 2024 13:22:52 GMT by E
Hi, I would appreciate some information on how income from forestry abroad should be reported, if at all. Thank you
Posted Tue, 30 Jan 2024 16:00:53 GMT by HMRC Admin 32
Hi,

Yes. as its not taxable in UK its not taxable for same source from abroad.

Thank you.
Posted Thu, 01 Feb 2024 14:08:15 GMT by HMRC Admin 2
Hi,

Income from the sale of timber from the ownership of commercial woodlands is exempt from both Income Tax and Corporation Tax. The exemption only applies if the timber cut or felled is not altered or transformed prior to sale profits arising from the occupation of commercial woodlands are not chargeable.

Capital Allowances cannot be claimed on capital expenditure incurred on plant or machinery connected with commercial woodlands.

If the woodland is connected with or attached to an existing farming trade, special consideration will have to be given as to the tax status of the operation.

Relief is not available for losses suffered or expenditure incurred on the preliminary clearance of woodland of woodland or other preparation of land for forestry purposes.  

If the exemption applies and it is not taxable then you would not need to report this to us.

Thank you.

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