Taxable Income and Taxable Gains derived from a property I have no control

I'm currently living in the UK. I'm the registered owner of a mortgaged property in Hong Kong. When I borrowed money from my uncle, who is also living in Hong Kong, before I moved to the UK, I signed an Assignment of Rental Income and Selling Proceeds document at a law firm. In the Assignment, I assigned to my uncle all of my rights and interests to receive any rental income generated and/or selling proceeds when disposing of the mortgaged property in the future. I have to obtain my uncle's consent when I rent out and/or sell the property. Given this arrangement, I'm wondering: (1) Would the rental income generated by the mortgaged property still be regarded as my taxable income? (2) Should I pay any capital gains tax when I dispose of the mortgaged property in the future?

Hi,
The beneficial owner of the rental income is the individual who will be liable to pay income tax on the rental income.  
As you legally assigned the rental income to your uncle, he is liable to income tax.  
As he is resident in Hong Kong, only he will be taxable on the rental income in Hong Kong.
Thank you.

Thank you for your clarification. In addition to rental income, can you also clarify if I would be liable for capital gains tax when the property is sold with gains in the future, as the beneficial owner of the selling proceeds is my uncle. Thank you very much.

HI
If you are not the beneficial owner and HMRC are aware of this fact, then no CGT will be due on you - it will be your uncle.

Thank you for the clarification again. Could you please confirm whether the property would not be subject to Inheritance Tax (IHT) when I pass away in the future? I was told by the lawyer who prepared the Assignment that all obligations contained in the Assignment are binding on my successors and the personal representative of my estate.

Hi,

Please contact the Inheritance Tax team for advice.

Inheritance Tax: general enquiries

Thank you.