Home Page

 First Steps

 Sample Costings

 Inspection Trips  

 Important Advice

 Renting Your Home


 Tax & Finance

 Other Information

 Post Purchase Help

 Contact Us



 Buying A Rental Villa In Orlando - Mortgage and Possible Tax Implications


If you are buying a rental villa in Orlando or anywhere in Florida, and you require a US mortgage, proof of means is not required if the amount you are borrowing is 70% or less of the purchase price/valuation.


Mortgage / Tax implications
When buying a rental villa in Orlando, if you decide to have a UK domiciled mortgage, unless you can afford to meet the mortgage from your own resources, you will need to off-set rental income to pay for it. For the purposes of UK tax (and you should take advice on this) rental income retained in the UK may well be subject to UK Tax. It could be beneficial to you have to a US mortgage and send all income received in the UK to the US to meet your rental liabilities. In the US your rental home is depreciated over the mortgage term and this allowance is off-set against rental income. The same is true for the home's fixtures, fittings and furnishings but over a 5-year period from the purchase date. Mortgage interest is also tax allowable. These allowances added to all your home rental expenses (i.e. utility costs, management fees, insurance, property tax etc.) your liabilities will exceed your rental income - certainly within the first few years. As a UK tax payer all income received (i.e. all your rental income) has to be reported to the Inland Revenue even although the income is not retained in the UK. Because this has been submitted to the United States Internal Revenue Service (IRS) for tax purposes any residual profit may be subject to UK tax. However, as detailed latterly, in the first few years 'expenditure' will exceed income so no residual profit will be made. No residual income, therefore no UK tax liability. 


Should you decide on buying a rental villa in Orlando the circumstances above relate to our own tax situation. As everyone's tax status and individual circumstances differ we recommend you take your own independent advice from a qualified source.

       Home Page    First Steps  Sample Costings  Inspection Trips  Important Advice  
       Renting Your Home  Marketing  Other Information  Post Purchase Help  Contact Us  

(c) Copyright 2006 WorldofOrlando.com