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A departure consultation can assist in dealing with the various tax and social security issues arising from a move overseas. Issues covered by a consultation would include:
Non residence claims
One of the most important tax considerations when leaving the UK will be the potential for claiming non resident status. The key advantage in obtaining this status will be that only income arising from the UK (e.g. UK investment income and certain gains) will remain taxable in the UK. An individual who continues to be regarded as resident on the other hand, will remain liable to UK tax on worldwide income.
The claim for non resident tax status is made through the filing of the Inland Revenue departure form P85. Generally, individuals who are leaving the UK for employment purposes will be considered non resident if they remain outside of the UK for at least one complete UK tax year. Individuals leaving for other purposes may have to demonstrate that their absence will last for longer than three years.
Tax Refunds
Individuals who leave the UK and successfully claim non resident status will often be able to claim a refund of tax in the year of departure. The claim is made at the same time as filing the Inland Revenue departure form P85 and would be included as part of the departure consultation.
Tax Compliance
In addition to the filing of forms P85, individuals who continue to receive UK income may be requried to file self assessment tax returns for each tax year ending 5 April. We can discuss these matters with you and determine whether filing UK tax returns will be beneficial.
For individuals who will be receiving UK rental income whilst overseas, an additional form known as an NRL1 should be filed with the Inland Revenue for application of the Non Resident Landlord's Scheme. Without this approval, agents or tenants will be required to deduct basic rate tax from rent paid and submit this to the Inland Revenue on a quarterly basis. In many cases, letting agents will take care of the filing of these forms. If not, we will complete and submit the form as part of the departure consultation.
For further information, please contact Richard Watts-Joyce CTA |
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A Member of the Global Tax Network (GTN) Tel : +44(0)20 7100 2126 Fax: +44(0)14 8344 9181 |