Renting home in the UK while in Denmark

Hi Expatters!

I've got a potential move to Denmark from the UK happening and I wonder if any of you have experience of renting out your house/apartment in you home country while in Denmark?

From what I understand the rent I receive less only my mortgage interest will be taxable in Denmark which almost makes it impossible financially. If anyone has any experience they could share that would be much appreciated...

Thanks

D

I would call SKAT. You find the phone number here http://skat.dk/skat.aspx?oId=2234800

On the same page you find a calculator, but as it is meant for Danish housings, I think it'll not make sense in your case.

Whether you have to refurbish your house or not when you are back will depend on the tenant. I have heard from an expat that their house needed an extensive refurbishment when they came back. Don't judge a dog by its collar, but take care you do a good paperwork.

/Nellie

Don't believe that you'll pay any Danish income tax on your US rental income, but be aware that there is what is basically a "wealth tax" that is assessed on second homes, including those outside of Denmark.  I am not certain if it applies to income property, or only to holiday homes.  Just something to be sure to ask your tax professional about.

Sluggo :

Don't believe that you'll pay any Danish income tax on your US rental income, but be aware that there is what is basically a "wealth tax" that is assessed on second homes, including those outside of Denmark.  I am not certain if it applies to income property, or only to holiday homes.  Just something to be sure to ask your tax professional about.

The poster is from the UK, so what has this to do with the US?

or am I missing something?

Just a typo (bloody autocorrect), I was posting about Danish tax liability so the country of origin doesn't really matter as long as they have a tax treaty with Denmark.

Since wealth tax is mention, I want to shed some light on this issue.

We pay no wealth tax in Denmark since 1997.

Are you thinking of the property tax, ejendomsværdiskat (property value tax)? You only pay this tax on the property where you're registered in the national register, and everybody pays this tax if they own a property so in itself it has nothing to do with wealth. However, the tax is relative and follows the value of the property.

/Nellie

We're probably talking about the same tax.  It was explained to me by my accountant at PWC as a sort of "wealth tax" for those who could afford to own property beyond their principal residence.

Yet a little clarification: You only pay 'ejendomsværdiskat' on one single property, and that's the property where you live and are registered. Maybe, your accountant has mentioned that (until now) you have paid a higher per cent if your property had a value more than 3 mio. kroner. This fact is often called an envy charge.

The taxation of real estate has now been drastically changed (by 2018). It is a complex issue and not relevant for this thread.

/Nellie

Tax is based on where you live.  If there is a double-taxation agreement between that country and where your assets are, then you won't be charged twice.  You can also use any costs incurred in maintaining the taxable asset to offset your tax liability where you now live.  Then there are social taxes; I'm not sure if Denmark has those, but they always fall outside any double-taxation agreement; in Holland, they hurt.

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