Uk Non-Domicile

[beau thai]

Inevitably the uk tax regime will become more onerous as the Chancellor must find new revenue to offset huge covid costs. That and my increasing age is causing me to think about non-domicile status. Firstly to shed IHT liabilities and secondly to reduce UK annual tax bills. 

Useless to discuss anyone's personal situation in this forum as all are unique. 

Non-Dom is very hard to achieve and needs experts who are up to speed with ever changing tax legislation and can analyse an individual's situation in that light, and advise 

So 2 questions :

Have any readers , uk born to uk parents,  but now living in Thailand, achieved non Dom uk status recently?? 

And has any one personally used advisors they recommend in this area? 

[Whale]

Why would you want to achieve non-dom? "Non-resident" is very easy to achieve if you don't want to be obligated to pay UK taxes. I would think 99% of the UK nationals here in Thailand are non-resident in UK tax terms rather than non-dom.

 

If you want to achieve non-dom for other reasons then I apologise for mentioning this.

[Surelynot]

5 minutes ago, Whale said:

Why would you want to achieve non-dom? "Non-resident" is very easy to achieve if you don't want to be obligated to pay UK taxes. I would think 99% of the UK nationals here in Thailand are non-resident in UK tax terms rather than non-dom.

 

If you want to achieve non-dom for other reasons then I apologise for mentioning this.

To become non-resident in the UK and avoid UK income tax I read that you must be tax resident somewhere else...ie Thailand.

 

Is that correct?

 

If so, what tax would I pay on my income here?

[Whale]

1 minute ago, Surelynot said:

To become non-resident in the UK and avoid UK income tax I read that you must be tax resident somewhere else...ie Thailand.

 

Is that correct?

 

If so, what tax would I pay on my income here?

 

No you just need to meet the requirements of Non Tax resident status in the UK. Standard tax rate here is 20% (I think) and you can get a TID number from the Thai tax office if you need one. If you don't work you don't have to do any Thai based income i.e. if you are retired or hanging out or living non savings or foreign income or whatever, you just do nothing.

 

[Surelynot]

2 minutes ago, Whale said:

if you are retired or hanging out or living non savings or foreign income or whatever, you just do nothing.

Cheers...that's me to a T.

 

Is there anyway to avoid tax on my income in the UK? The income is from pensions, property rental and the stock market.

 

Thanks in advance for any response....I realize I am being lazy in asking you.

[quake]

54 minutes ago, Surelynot said:

Cheers...that's me to a T.

 

Is there anyway to avoid tax on my income in the UK? The income is from pensions, property rental and the stock market.

 

Thanks in advance for any response....I realize I am being lazy in asking you.

if your a uk citizen , non resident you sill get the 12,500 tax allowance same as if uk resident.  over that you pay at 20% on uk income.

 

 

 

 

Edited December 19, 2020 by quake

[Surelynot]

1 minute ago, quake said:

if your a uk citizen , non resident you sill get the 12,500 tax allowance same as if uk resident.  over that you pay at 20%

 

 

...and being non-resident (or something else) you simply cannot avoid paying the 20%?

[quake]

17 minutes ago, Surelynot said:

...and being non-resident (or something else) you simply cannot avoid paying the 20%?

over 12,500 uk income, no as a non resident, but non dom , non resident, I don't know, i'm pretty sure dividends are tax free

maybe tell us all, what you are trying to do, full story please.

i'm sure someone will know a way round things.

but tax avoidance is a big issue now days with the uk.

 

Ps sorry got you a bit mixed up with the Op. 

 

Edited December 19, 2020 by quake

[ctxa]

If you plan to stay Thailand, you could just bring all your money to Thailand. Show your middle finger to BoJo and never pay taxes in the UK again. It's not like they're gonna send Interpol to find you in Thailand or something, lol

Edited December 19, 2020 by ctxa

[Surelynot]

Just now, ctxa said:

If you plan to stay Thailand, you could just bring all your money to Thailand. Show your middle finger to BoJo and never pay taxes in the UK again. It's not like they're gonna send Interpol to find you in Thailand or something, lol

Mmmmm...... I can see the headlines now...."My dad, First person ever to be tracked down by Interpol for tax evasion""

[quake]

6 minutes ago, ctxa said:

If you plan to stay Thailand, you could just bring all your money to Thailand. Show your middle finger to BoJo and never pay taxes in the UK again. It's not like they're gonna send Interpol to find you in Thailand or something, lol

I agree.

but, i had gone all in for Thailand, but have changed my mind now.

this is not the nice friendly place it was 20 years ago.

I would say be careful and keep one eye on the door.

Better to walk through the door, rather than, be kicked through it at a latter date.

TIT

 

 

Edited December 19, 2020 by quake

[fangless]

10 minutes ago, ctxa said:

If you plan to stay Thailand, you could just bring all your money to Thailand. Show your middle finger to BoJo and never pay taxes in the UK again. It's not like they're gonna send Interpol to find you in Thailand or something, lol

If the income is "taxed at source" that line of attack will not work.

 

For the OP; Also of course remember that if on state pension that it will be frozen at the rate payable on the day you (the OP)  "reside" in Thailand.  I suspect however that the tax on your other income from the UK would be greater in your case than the increase via "triple lock" on your state pension.

 

Edited December 19, 2020 by fangless

[quake]

2 hours ago, beau thai said:

IFirstly to shed IHT liabilities and secondly to reduce UK annual tax bills. 

Are you aware of  the IHT rules. his one reckon most don't know.

in around 2014 the rules were changed for foreign wives.

you can now be married to a foreigner, and you and she be none resident

and you get your 320,000 nil band rate IHT, and she gets a 320,000 Nil band rate now.

so 640,00 before IHT. plus if you and she become uk resident you get an extra 175,000

of Nill band rate, so a total of 815,00 before IHT.

This could be good for some people.  

 

 

 

 

 

Edited December 19, 2020 by quake

[Almudena]

1 hour ago, quake said:

if your a uk citizen , non resident you sill get the 12,500 tax allowance same as if uk resident.  over that you pay at 20% on uk income.

 

 

 

 

Or bung £20K into a tax free ISA account each year and pay sod all. 

Edited December 19, 2020 by Almudena

[quake]

16 minutes ago, Almudena said:

Or bung £20K into a tax free ISA account each year and pay sod all. 

you may wish to have a read of this thread, there is one a bit more in depth but cant find it for now,

but try this.

https://forum.thaivisa.com/topic/1195999-contributing-to-uk-isa-while-abroad/

 

found it. there is a bit more in this thread about isa, my bad on that thread.

https://forum.thaivisa.com/topic/1195426-how-much-help-do-you-need-from-relatives-at-home/

 

 

Edited December 19, 2020 by quake

[topt]

On 12/19/2020 at 2:09 PM, quake said:

Are you aware of  the IHT rules. his one reckon most don't know.

in around 2014 the rules were changed for foreign wives.

you can now be married to a foreigner, and you and she be none resident

and you get your 320,000 nil band rate IHT, and she gets a 320,000 Nil band rate now.

so 640,00 before IHT. plus if you and she become uk resident you get an extra 175,000

of Nill band rate, so a total of 815,00 before IHT.

This could be good for some people.  

 

 

 

 

 

The Nil Rate Band is now £325k  

I don't understand where you are getting this extra from by becoming resident? My understanding is the extra 175k comes from leaving property to children/grandkids - 

https://www.moneyadviceservice.org.uk/en/articles/a-guide-to-inheritance-tax

 

Quote

The RNRB is on top of the NRB and the TNRB. To be eligible you must pass your home or a share of it to your children or grandchildren. 

 

[topt]

On 12/19/2020 at 12:03 PM, beau thai said:

Have any readers , uk born to uk parents,  but now living in Thailand, achieved non Dom uk status recently?? 

And has any one personally used advisors they recommend in this area? 

Sorry don't have any specific answer to that.

This article and linked ones may be of interest -

 https://www.etctax.co.uk/knowledge_centre/non-uk-resident-property-investors-iht-residential-property/

 

Non dom status has come up a couple of times here in the last few years and one guy was taking advice from a UK company. I wouldn't bother trying to search directly with the TV search bar but you may have a chance using a search engine and looking for Thai Visa forum domicile status or similar.

[quake]

1 hour ago, topt said:

The Nil Rate Band is now £325k  

I don't understand where you are getting this extra from by becoming resident? My understanding is the extra 175k comes from leaving property to children/grandkids - 

https://www.moneyadviceservice.org.uk/en/articles/a-guide-to-inheritance-tax

 

 

I,m pretty sure i got it from the uk government Webb site.

it was in regard to the family home, not cash and it was for wife , non uk dom,

that become resident,   have a look, i'm pretty sure i'm correct.

if i.m wrong ok,

 

325,000, yes your correct.

But have never sweated the small change. 

 

 

Edited December 20, 2020 by quake

[Oxx]

If non-domiciled only one's UK estate is subject to inheritance tax.  If UK-domiciled, one's entire, world-wide estate is subject to inheritance tax.

 

Unless one has specific (and rare) circumstances that require a domicile determination before death, HMRC will not provide an opinion.

 

In theory, one can get an opinion from a QC which should be binding.  Last time I checked, this would cost over GBP 10,000.  And if one's circumstances changed, then the opinion would become worthless.

The best one can do is sever as many ties with the UK as possible (no property, no bank accounts, infrequent visits, &c.), establish strong links with Thailand, and keep one's fingers crossed.  Even then one's executors may have a struggle.  Hector is very reluctant to keep his grubby mitts off our money.

[DaLa]

Your UK state pension  will be free of UK income tax, however any private pensions taking you above the £12,500 personal allowance will be taxed at the relevant rate as it's deemed to be UK income.  So if all you have is savings and the state pension I would personally be registered and 'living' in the UK so you obtain the pension increases.

[lungbing]

No, your UK state pension is not free of income tax, it is just paid to you without tax being stopped.  But it counts towards your total taxable income.

[topt]

1 hour ago, quake said:

But have never sweated the small change. 

So 175k was small change..........oh sorry you weren't commenting on that bit 

[quake]

8 hours ago, topt said:

So 175k was small change..........oh sorry you weren't commenting on that bit 

you correct the RNBR of 175.000 is for direct decedents.

I had a look and cant find anything about Non Dom spouse and getting the extra 175,000 RNBR.

Must have been a heavy Chang day,  my bad. 

[prakhonchai nick]

All income originating in the UK is subject to income tax. As a UK resident/ordinary resident, you are currently entitled to a £12,500 tax allowance. Any income receied above that amount is taxed - starting at 20%.

 

State pensions are not taxed at source, but any private/occupational pension will be subject to tax, and if the combined pensions,including the state pension amounts to more than £12,500, tax will be taken at source from the private/occupational pension. Any dividends are, I believe, taxed at source.

[partington]

On 12/19/2020 at 5:33 AM, Surelynot said:

Cheers...that's me to a T.

 

Is there anyway to avoid tax on my income in the UK? The income is from pensions, property rental and the stock market.

 

Thanks in advance for any response....I realize I am being lazy in asking you.

 No way to avoid tax on rental income or pension income arising in the UK even if non-resident.

 

However investment income and capital gains tax  from stock  and bond funds  are avoidable completely legally for a non-resident. Capital gains tax , providing you have been non-resident for a number of years, I think it's five, but you can look this up on HMRC site, is not chargeable to non-residents (with the exception of property sales).  I feel this is bound to change soon, so if you have  huge current cap gains on stocks selling and buying back will at least lock you in to the new higher price as  a baseline.

 

Dividends and interest from stock and bond funds, domiciled in countries other than the UK, e.g.  Ireland, are completely non-taxable to a UK non-resident with no qualifying minimal period, even though held in a UK brokerage, because they are "foreign income". That is, the income is considered income earned by a non-UK resident, arising outside the UK, so it is untaxable by HMRC. For example, all or most of Vanguard's London stock exchange traded  tracker bond and equity ETFs are domiciled in Ireland, so buying these eliminates taxes on them (for a non-resident).

 

I know both of these to be true because I was in this position myself for about 10 years. To work out my UK taxes I bought a UK tax app (one of those approved by HMRC) and it flagged all my Ireland- and Luxembourg-domiciled ETF income as non-taxable.

 

 

Edited December 21, 2020 by partington

[Surelynot]

2 hours ago, partington said:

 No way to avoid tax on rental income or pension income arising in the UK even if non-resident.

 

However investment income and capital gains tax  from stock  and bond funds  are avoidable completely legally for a non-resident. Capital gains tax , providing you have been non-resident for a number of years, I think it's five, but you can look this up on HMRC site, is not chargeable to non-residents (with the exception of property sales).  I feel this is bound to change soon, so if you have  huge current cap gains on stocks selling and buying back will at least lock you in to the new higher price as  a baseline.

 

Dividends and interest from stock and bond funds, domiciled in countries other than the UK, e.g.  Ireland, are completely non-taxable to a UK non-resident with no qualifying minimal period, even though held in a UK brokerage, because they are "foreign income". That is, the income is considered income earned by a non-UK resident, arising outside the UK, so it is untaxable by HMRC. For example, all or most of Vanguard's London stock exchange traded  tracker bond and equity ETFs are domiciled in Ireland, so buying these eliminates taxes on them (for a non-resident).

 

I know both of these to be true because I was in this position myself for about 10 years. To work out my UK taxes I bought a UK tax app (one of those approved by HMRC) and it flagged all my Ireland- and Luxembourg-domiciled ETF income as non-taxable.

 

 

Thanks for taking the time to write this....much appreciated.....If any of my investments ever pay up I will bear this all in mind.....currently sticking to my policy of buying at the top and selling at the bottom....so little chance of being taxed...555

[phka]

On 12/19/2020 at 12:14 PM, Whale said:

Why would you want to achieve non-dom? "Non-resident" is very easy to achieve if you don't want to be obligated to pay UK taxes. I would think 99% of the UK nationals here in Thailand are non-resident in UK tax terms rather than non-dom.

 

If you want to achieve non-dom for other reasons then I apologise for mentioning this.

Being non resident doest get you off inheritance tax. 

No benifits of being non resident anymore George Osborne saw to that 

[phka]

6 hours ago, Surelynot said:

Thanks for taking the time to write this....much appreciated.....If any of my investments ever pay up I will bear this all in mind.....currently sticking to my policy of buying at the top and selling at the bottom....so little chance of being taxed...555

From 2015 non resident British citezens became liable for capital gains tax 

[Oxx]

4 minutes ago, phka said:

From 2015 non resident British citezens became liable for capital gains tax 

 

Male cow ordure.  From 2019 non-residents became liable for CGT on land/property.  Other investments remain CGT-free (provided one remains non-resident for the requisite period).

[beau thai]

On 12/19/2020 at 12:14 PM, Whale said:

Why would you want to achieve non-dom? "Non-resident" is very easy to achieve if you don't want to be obligated to pay UK taxes. I would think 99% of the UK nationals here in Thailand are non-resident in UK tax terms rather than non-dom.

 

If you want to achieve non-dom for other reasons then I apologise for mentioning this.

yep non res is easy but doesnt avoid iht which is my objective