Avoiding Uk Income Tax

[itsgottabedone]

I will be moving to Thailand in January,but due to limited job oppertunities in Thailand for myself,i expect to return to UK a few months per year to work.As i understand the income tax allowance is about £5200 per year so if i earn up to that i can claim tax back right ?

Im sure there must be loads of people who live Thai/UK who do this.Anyone can explain what they do ? Experiences etc ?

Hi hgvneil

To get back to your original question, you can earn upto £5225 without being liable for tax however you will probaly have tax deducted anyway under PAYE.

It is then up to you to write to your local tax office at the end of the tax year and recover any overpayment. it might be worth earning another £2230 as this is only taxed at 10%.

Seems to work well as the Boss Lady has been doing this the last few years on our 6 month stint in UK

However this only works for her because she has no other income in the UK i.e. building Society interest, dividends etc. Which would need to be taken into account when calculating your total income.

TBWG

Just to add you don't have to wait until the end of the tax year to claim this money back. Contact your local tax office and explain you do not intend to work for the rest of the tax year and you suspect you are entitled to a rebate. They will send you a form where you simply put in your income for the year and send it back. Approx 4 weeks later they will send you a cheque for the rebate. The only downside is you can't do it online and they can't do the refund by BACS (this was the case last year anyway)

[ArranP]

Naka - I'm going to stick my neck out,

Although the form you quote does not say so if your UK taxable income is over the personal allowance (£5,200 or so) then you do pay tax on the saving (above the allowance).

I'd love to be proved wrong?

(grammatical error corrected)

Briley, I like you for many years assumed interest on UK savings was taxable. Not the case! 18 months ago I visted a reputable expat financial advisor here in Thailand to basicly iron out my savings and pension plans. This subject arose and he said this was not the case. I then contacted the tax office in the UK enquiring about this and they said it was right. The reason I had payed tax on my savings is that I had neglected to tick a box (9.7 on your UK tax return) to claim back personal allowances. Ticking this box in conjunction with claiming you are non-resident allows you to claim back interest on my UK savings. I realised this had been happening for around 5 years and wrote them a letter stating such. A month later I recieved a hefty payment into my bank account. Cause for celebration.

In addition last year I also recieved a letter that because I had been a non-resident for some years and had no taxable income in the UK then they would no longer send me a return each year to complete! Officially off their radar, happy days!

Are you certain ?, I'm not stating this is not the case, however I read this R105 form and also contacted the IR, they said I get the interest paid tax free, however at the end of year when I file my self assesment, I pay the tax then. ie. the tax payment is only deferred, I'm talking here about interest returns of GBP 6,000+. This was all discussed in the case of being "non-uk resident", the conclusion I came to, was that uk derived income has uk tax payable, wether non-resident or not.

Also, for getting consistent returns, yes with cash accounts you can get just over 6%, capital guaranteed. However take a look also too the fund "Ground Rent", it has given between 8-10% consistently over the past 10 years, however capital is not guaranteed.

[BalthazarBeefheart]

I am very grateful for the information received from here - a year ago when visiting the UK I phoned the Revenue and put the question should I be paying UK tax on my occupational pension and deposit interest. I was informed that as the income was earnt in the UK I was therefore liable for UK income tax. That has cost me a fair few quid on the deposit interest- but am I correct in thinking that there is nothing I can do to avoid UK tax on my pension.

Cheers BB

[JAS21]

I am very grateful for the information received from here - a year ago when visiting the UK I phoned the Revenue and put the question should I be paying UK tax on my occupational pension and deposit interest. I was informed that as the income was earnt in the UK I was therefore liable for UK income tax. That has cost me a fair few quid on the deposit interest- but am I correct in thinking that there is nothing I can do to avoid UK tax on my pension.

Cheers BB

Sorry about edit...somehow it shot straight through..

Once you have deducted your personal allowance..you will be taxed at the appropraite rate..I'm in the same boat..but put your savings off shore as suggested earlier.

Edited June 10, 2007 by John45