Property taxes are one of the biggest areas of confusion for UK buyers purchasing real estate in Florida, largely because the US system works very differently from the UK.
This guide explains what taxes UK buyers can expect when owning Florida property, how they compare to UK taxes, and the common misunderstandings British buyers often have before purchasing.
What property taxes exist in Florida?
Florida does not have a direct equivalent to UK council tax or stamp duty, but there are still important taxes and costs to understand.
Annual Florida property tax
Property tax in Florida is charged annually by the county and is based on:
- The assessed value of the property
- Local tax rates
- Any applicable exemptions (usually not available to overseas buyers)
Rates vary by location, but UK buyers typically see annual property taxes ranging from roughly 0.8% to 1.3% of the property’s value.
No state income tax
Florida does not charge state income tax, which is one reason it attracts both US and overseas buyers. However, this does not remove all tax obligations for UK residents.
How Florida property taxes compare to the UK
UK buyers often try to map US taxes directly onto the UK system, which can lead to incorrect assumptions.
Key differences include:
- Council tax vs property tax
Council tax is based on occupancy and banding, while Florida property tax is value-based and paid by the owner. - Stamp Duty vs closing costs
Florida does not have stamp duty in the UK sense. Instead, buyers pay one-off closing costs at purchase.
Understanding these differences early helps UK buyers budget more accurately and avoid unpleasant surprises.
Do UK buyers pay capital gains tax in the US?
Yes, capital gains tax can apply in the US when a property is sold, regardless of the owner’s nationality.
Key points UK buyers should understand:
- Capital gains may apply if the property is sold for more than its purchase price
- FIRPTA (Foreign Investment in Real Property Tax Act) can require tax withholding at sale
- The exact amount depends on ownership structure, holding period, and use of the property
This is an area where professional US and UK tax advice is essential, as individual circumstances vary.
Do UK buyers also pay tax in the UK?
UK buyers may also have UK tax considerations depending on:
- UK tax residency status
- Whether the property is rented
- How the property is owned
The US–UK double taxation treaty exists to prevent the same income being taxed twice, but it does not remove the need for proper reporting in both countries.
This is why many UK buyers plan their ownership structure carefully before purchasing.
Typical tax-related costs UK buyers should budget for
In addition to annual property tax, UK buyers should factor in:
- Property insurance (often higher than UK buildings insurance)
- HOA fees (if buying a condo or managed community)
- Accountant or tax filing costs if renting the property
- Potential withholding at sale under FIRPTA
Taxes are only one part of the overall ownership cost picture.
Common tax misunderstandings UK buyers have
Some of the most frequent misunderstandings include:
- Assuming Florida property tax works like council tax
- Believing no US tax applies because they live in the UK
- Not accounting for FIRPTA when selling
- Confusing income tax with property tax
Clarifying these points early helps UK buyers make more confident decisions.
How tax considerations affect buying decisions
Tax implications can influence:
- Whether to buy as an individual or through an entity
- Whether a property is suitable as an investment or second home
- Which Florida city or county makes the most sense
For example, buyers considering Sarasota often balance lifestyle benefits with long-term ownership costs rather than purely focusing on tax efficiency.
Why UK buyers often work with a Florida-based agent
While tax advice should always come from qualified professionals, many UK buyers prefer working with a Florida-based agent who regularly works with UK clients to ensure tax considerations are raised early, not discovered later.
This is particularly useful when buying remotely or comparing different Florida markets.
A practical next step for UK buyers
If you’re a UK buyer trying to understand how Florida property taxes fit into the bigger picture — alongside the buying process, mortgages, and ownership costs — speaking with a Florida-based agent who regularly works with UK buyers can help you plan with clarity before committing.
