Does the English taxation system allow for the refunding of paid taxes?

Question

I am American, my wife is from the UK. When she moved to the U.S, she rented out her flat using a property management firm. We are being told by this management firm that they have received a letter from the Inland Revenue Service insiting that 23% of the collected rent be paid per month for taxes.

In the U.S, we file taxes at the end of year and submit expenses against paid taxes. Most of the time, this results in a partial tax refund to the tax payer. My question...is there a similar situation in the UK, or is taxed monies gone,once paid to the government?

Answer 1

yes! the UK inland revenue will refund taxes, if an incorrect amount has been paid! Not sure over your individual case, but i have been on the wrong tax code for the past few months and just recieved a very healthy cheque from them!LX

Answer 2

It's called the Non resident Landlord Scheme.

Basically, if a person will be out of the UK for longer than 6 months, the scheme applies. The scheme says that the basic rate of tax (20%) will be withheld from the rental income. But she can apply for approval to receive her rents gross using form NRL1. It doesn't exempt the rents from UK tax, it just allows her to receive the income without the tax deductions each month. Look at the link for more info and the form NRL1

http://www.hmrc.gov.uk/cnr/nr_landlords....

If your wife has had tax withheld and passed to HMRC, then she may be due a repayment if her income is covered by expenses and personal allowance. The letting agency should give her a certificate called NRL6 to confirm the amount of tax deducted. If there is no liability due, then she can do a form R43. If the income is above the personal allowance, a Self Assessment Tax Return form will be needed. Get the NRL1 form in first though!! :o)

Answer 3

when you rent out a flat in the uk the money from that flat is classed as unerned incom so you have to pay tax on it