Resident in Thailand but paying UK tax on UK assets

[RandolphGB]

Is it possible to live in Thailand and be resident here, paying tax to the Thai government from employment in Thailand.... but hold assets in the UK such as shares, and pay Capital Gains Tax and dividend tax on that UK income, to the UK government without being resident in the UK?

 

 

 

[nigelforbes]

Yes, many people do. There is a tax treaty between the two countries so you wont be taxed twice. I live in Thailand and may tax here on income but also file a UK return and pay tax on investments and property rental.

[CharlieKo]

28 minutes ago, nigelforbes said:

Yes, many people do. There is a tax treaty between the two countries so you wont be taxed twice. I live in Thailand and may tax here on income but also file a UK return and pay tax on investments and property rental.

My accountant kept asking me about earnings in Thailand. My understanding is that the HMRC expect you to declare any Thai earnings. They accept Thai Tax have first call on taxing Thai income. But.

 

If income tax is 15% here. HMRC will want the other 5% to match the 20% tax in the UK. Depending on how the money was earned, Thai Revenue may or may not inform HMRC. 

 

I think it's down to you to declaring Thai earnings to HMRC. I don't think Thai revenue inform HMRC. Not 100% sure though.

Edited February 12, 2023 by CharlieKo

[nigelforbes]

1 minute ago, CharlieKo said:

My accountant kept asking me about earnings in Thailand. My understanding is that the HMRC expect you to declare any Thai earnings. They accept Thai Tax have first call on taxing Thai income. But.

 

If income tax is 15% here. HMRC will want the other 5% to match the 20% tax in the UK. Depending on how the money was earned, Thai Revenue may or may not inform HMRC. 

Can you declare yourself not UK resident for tax purposes, that way you can exclude Thai earnings, and take advantage of the UK tax free allowance? This is what I've done and there isn't an issue. 

[CharlieKo]

1 minute ago, nigelforbes said:

Can you declare yourself not UK resident for tax purposes, that way you can exclude Thai earnings, and take advantage of the UK tax free allowance? This is what I've done and there isn't an issue. 

Yes, I am NRL (non resident Landlord)  as far as HMRC concerned. But that doesn't mean you are exempt from paying UK tax on Thai earnings. 

 

I don't think you can take advantage of the tax free amount on Thai earnings you should ask an accountant.

 

Having retired and getting a fixed state pension because I live here. Not being entitled to future increases. I don't see why I should pay tax on Thai earnings to HMRC.

 

If it's down to self reporting because Thai Revenue don't inform HMRC. You have an answer of sorts! 

 

Personally I have no intention of informing HMRC of anything related to Thailand other than I live here.  

 

 

 

 

 

[nigelforbes]

9 minutes ago, CharlieKo said:

Yes, I am NRL (non resident Landlord)  as far as HMRC concerned. But that doesn't mean you are exempt from paying UK tax on Thai earnings. 

 

I don't think you can take advantage of the tax free amount on Thai earnings you should ask an accountant.

 

Having retired and getting a fixed state pension because I live here. Not being entitled to future increases. I don't see why I should pay tax on Thai earnings to HMRC.

 

If it's down to self reporting because Thai Revenue don't inform HMRC. You have an answer of sorts! 

 

Personally I have no intention of informing HMRC of anything related to Thailand other than I live here.  

 

 

 

 

 

Being a NRL is not the same as being not UK resident for tax purposes. As you will know, the NRL scheme only allows you to receive rental income free of tax in the expectation you will settle your taxes via a return at year end. If you are not UK resident for tax purposes, that scheme can continue but when you file your UK return, you will exclude any income that doesn't arise in the UK. Your Thai income is then subject to Thai tax rules and is ring fenced, it means you can take advantage of the Thai Revenue tax free or zero rated band.

[JackGats]

In most EU countries rental income in the EU country is always subject to tax in that EU country even if you reside in Thailand. In Germany they have a word for it that means "reduced tax liability" (geschränkt steuerpflichtig). As to revenues like pensions generated in the EU country, you get taxed by the EU country if the pension is subject to a witholding tax in said EU country which is the case of "state pensions". A private pension is another matter, it can sometimes be transferred free of tax and it's then up to the recipient to declare it for taxation in Thailand (or not). Thailand's reluctance to tax should be Thailand's business, not the UK's or the EU countries'.

 

As to capital gains eg on the sale of shares/stocks held in an EU bank, they are to be declared and taxed (or not) in the country of residence which is in our case Thailand.

 

Dividends however are always subject to tax first at source in the country of the company paying the dividend, second in the country of residence if said country has a tax on dividends. I understand the UK has not taxes on dividends, that's why BP, before it got clobbered because of the war in Russia and the windfall tax, was such a good stock to own if you lived in Thailand.

 

I have a Thai TIN which I filed with my EU banks in order to give them something to chew on. TINs are used withing the CRS if I'm not mistaken. This means infos on my finances in Thailand could be reported to the EU countries by Thailand (or sollicited by the EU countries from Thailand?) using my TIN number. I don't think Thailand can be bothered at this stage to send reports though.

[stubuzz]

2 hours ago, nigelforbes said:

I live in Thailand and may tax here on income but also file a UK return and pay tax on investments and property rental.

Why do you submit a UK tax return if you are a UK non tax resident?

[Mac Mickmanus]

43 minutes ago, stubuzz said:

Why do you submit a UK tax return if you are a UK non tax resident?

He gets an income from the UK , through rental property and so he needs to pay tax on that .

   

[nigelforbes]

2 hours ago, stubuzz said:

Why do you submit a UK tax return if you are a UK non tax resident?

Because I have income that arises in the UK, Pension and rental income.

[RandolphGB]

Thanks for the responses. Dividend payments in a share account slightly exceeded the 2,000 GBP allowance in 2021 / 22 tax year. 

 

Is is right that I now have to submit a self assessment tax return? They were my only income from the UK but it's still under the 10,000 GBP personal allowance.

 

They exceeded the 2k dividend allowance but the total is under the 10k Personal Allowance.

 

It's also late so I'm aware there'll be a penalty! 

Edited February 12, 2023 by RandolphGB

[Mike Teavee]

2 hours ago, stubuzz said:

Why do you submit a UK tax return if you are a UK non tax resident?

Lots of reasons why, in my case (Non-UK Resident for Tax Purposes for 15 years) it’s because I used to own a Limited Company & have never managed to shake the requirement for completing a Tax Return. 
 

My (ex-company) accounting firm files them for me, I’m not able to reclaim the £240 I need to pay them but they do a great job on staying on top of property allowances so I always seem to come in with UK Gov owing me a few £s in overpaid tax (Approx £24K pa from Rental Income & Dividends, No Capital Gain Tax unless you’re selling property).

 

[RandolphGB]

11 minutes ago, Mike Teavee said:

Lots of reasons why, in my case (Non-UK Resident for Tax Purposes for 15 years) it’s because I used to own a Limited Company & have never managed to shake the requirement for completing a Tax Return. 
 

My (ex-company) accounting firm files them for me, I’m not able to reclaim the £240 I need to pay them but they do a great job on staying on top of property allowances so I always seem to come in with UK Gov owing me a few £s in overpaid tax (Approx £24K pa from Rental Income & Dividends, No Capital Gain Tax unless you’re selling property).

 

I'd add to that it can be worth paying contributions for the pension and welfare system. I hear no end of stories of people who have to go from Thailand back to the UK and because they have been away for so long, there's no support.

 

Just done the online tool to see if I need to file a self assessment return which says 'do not need to' but the government page has this message 

 

• voluntarily pay Class 2 National Insurance contributions - you’ll need enough contributions to claim some benefits and the State Pension

 

 

 

Edited February 12, 2023 by RandolphGB

[Mac Mickmanus]

27 minutes ago, RandolphGB said:

Thanks for the responses. Dividend payments in a share account slightly exceeded the 2,000 GBP allowance in 2021 / 22 tax year. 

 

Is is right that I now have to submit a self assessment tax return? They were my only income from the UK but it's still under the 10,000 GBP personal allowance.

 

They exceeded the 2k dividend allowance but the total is under the 10k Personal Allowance.

 

It's also late so I'm aware there'll be a penalty! 

If you are required to fill in a self assessment form and you don't do it , you get a 100 Pound fine, then 10 Pound a day fine

[Chomper Higgot]

Yes.

 

Or I want some tax payments back.