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NON RESIDENCE TAX MATTERS
JUNE 2016
About Us
Our Work
Residence and Domicile
Leaving the UK and Record Keeping
Case Studies
AGENDA
About US
Our Client
s
DENARIUS CONSULTING
Established 2009
Consultant Model with Associates
Regulated by CIMA
Based in Birmingha
m
Clients all over the
world
SOME OF OUR CLIENTS
Practice
Accounts Preparation
Tax advice
Company formation and advice
Consultancy
International Tax
Interim Management
Business Improvement
OUR WORK
RESIDENCE AND DOMICILE
NON RESIDEN
CE NON DOMICILED
NON DOMICILEDUK resident but not domiciled for UK tax
3 types of Non Dom: origin (acquired from father); choice and dependence
Very topical so HMRC will want to conduct in-depth examination
Remittance basis of calculating tax on foreign income
Remittance Base Charge of £30k to £50k per annum
Complex and requires careful planning
NON RESIDENCEStatuto
ry Residence Test
• A set of rules to determine your tax residenceSplit Year
Treatment
• A mechanism where the tax year is split into UK and Overseas parts
Double Taxation
• Agreements with other nations to ensure tax is charged once
Non Residen
t Landlor
d
• Special rules apply for non resident landords
STATUTORY RESIDENCE TEST
Introduced in the Finance
Act 2013
• TEST 3: you work overseas and spend fewer than 91 days in UK; and do not work in UK for more than 30 days
SPLIT YEAR TREATMENT
UK part is start of tax year to when you move Abroad – that is start of
Overseas partUK Part – all income
taxable under UK lawOverseas Part – all income taxable under the rules of
host nation
The number of days you are allowed in the UK is determined by
when you left
DOUBLE TAXATION TREATY
• This works alongside Non Residence status
• Ensures overseas income is tax free
Double Taxation
Agreements• The treaty was signed in October 2007• Covers all taxes including Income Tax
KSA Agreement
• Need to ensure received before overseas period ends
• Any payment received during UK residency taxable
Bonus Payments
• Interest on savings can be received tax free
• UK Government securities will be Free of Tax
Other Exemptions
NON RESIDENT LANDLORD
Do you rent out property? If so then
you will be subject to NRL Scheme
HMRC directive to collect tax at source – through agent family
or tenant
Property Accounts required & Self
Assessment Return
Rental Income can be received with no tax
deducted
NRL Scheme
LEAVING THE UK
Appoint Agent
Complete P85 & other forms
Maintain records for evidence
Complete SA if necessary
RECORD KEEPING
Boarding Passes and
VISA stampsBANK
ACCOUNTS
Work calendar – meetings,
etc
CREDIT CARDS
Mobile Phone useage
PRIVATE MEDICAL
COVERSORN
notification vehicle off
road
MUNICIPAL TAXES
CASE STUDY ONEDavid Wright has worked and lived in Dudley for the last ten
years. He goes to work in Saudi Arabia on the 12 May 2015. On
the 7 July he returns to the UK to complete some IV work to 24 July. He then takes leave until 7 August before returning to Saudi Arabia
on the 8 August. He then continues to work overseas until
April 2015.Consider the split treatment
for above?
CASE STUDY ONE
David Wright was resident in the UK
2013/14
He was also resident in the UK 2014/15 and DOES NOT meet the 3rd
automatic test
He is Non Resident in 2015/16 and meets the 3rd
automatic test
He did not exceed the UK work days limit of 27 days
and permitted visit of 82 days
His UK part of tax year is 06/04/15 to
11/05/15 and Overseas part is
12/08/15 to 05/04/16
Total Days spent in UK during Non Residence is 32 days and Work
days in UK totals 14
CASE STUDY TWOMaya Kaur has been living in
the UK since she was born and is UK resident for tax purposes. She has worked as Principal of a College for the last twelve years. She gets a job as Principal of a
college in Riyadh and lives in an apartment provided by her
employer. She moves there on the 29 August 2015 and only
returns each year for 2 weeks at Christmas.
CASE STUDY TWO
Maya will receive split year
treatment for 2015-16 as she
was a UK resident in 2014-15
She is non-UK resident for 2016 to 2017 and meets the third automatic
overseas test for that year
She spends only 14 days in the UK
between 29/08/15 and 05/04/16. This
is less than the permitted 60 days
Maya does not work at all in the
UK during the period. She could
have worked for 20 days.
UK Tax part is 06/04/15 to
28/08/15Overseas Tax part
is 29/08/15 to 05/04/16
QUESTIONS?>FORM(s)>
CONTACT DETAILS
O: 0845 299 7478
M: 07932 588 391
W: www.denariusconsulting.net
