Uk Citizens - Non-Resident Or Not?

[RAZZELL]

i think the point is an important one. It is perfectly possible and completely legal (as an expat in Thailand) to have a very considerable income from certain UK assets (excluding property) without paying any personal income tax (on this income) in the UK.

Could you explain this a bit more for us thickos?

What about "earned" income?

Say you worked online, or flogged widgets to the UK from Thailand and were paid in £££ into a UK bank account. But all the work was carried out in Thailand.

How could you limit your tax liabilities in the UK?

RAZZ

[PattayaParent]

Id strongly advise anyone with substantial wealth in UK to get most out ASAP....

And give up decent deposit protection, decent interest rates, no tax on interest and a currency that is likely to appreciate in the medium term? No thanks.

Personally domicile and IHT dont bother me at all; I have no immediate family and dont want any. When I die I will be leaving an amount below the IHT theshold to some fairly distant nephews and nieces whom I rarely see, and the rest of my wealth (which is many times the IHT threshold) will be going to charity. I dont expect a penny of IHT to be paid when I die so my domicile really doesnt matter a jot.

Horses for courses.

The IHT nil rate band threshold is only applicable to spouses, not to children or distant relatives so all of your estate will be subject to IHT @40%.

But then as you'll be dead it doesn't really matter. I didn't care myself until I got married and had a kid and would rather the money went to them than to the tax man.

[wordchild]

i think the point is an important one. It is perfectly possible and completely legal (as an expat in Thailand) to have a very considerable income from certain UK assets (excluding property) without paying any personal income tax (on this income) in the UK.

Could you explain this a bit more for us thickos?

What about "earned" income?

Say you worked online, or flogged widgets to the UK from Thailand and were paid in £££ into a UK bank account. But all the work was carried out in Thailand.

How could you limit your tax liabilities in the UK?

RAZZ

sorry if it was not clear but what i was referring to was the taxation on savings ie dividends and bank interest. As Darrel points out the taxation on earned income is a different story and is,in general, not avoidable.

However (FWIW) in the case you mention, that business sounds like it could/ should be treated as a Thai based company exporting directly to customers in the UK and invoicing them from Thailand, in which case the earnings/profits would be a matter for the Thai tax authorities.

Edited May 11, 2012 by wordchild

[Darrel]

The IHT nil rate band threshold is only applicable to spouses, not to children or distant relatives so all of your estate will be subject to IHT @40%.

No it isnt. And presumably you missed the part about "all the rest going to charity". Legacies to charities are exempt also.

There will be no IHT payable when I die (with the rules as they currently stand).

[PattayaParent]

This month should see the UK Govt publication of its response to its consultation on the introduction of a statutory residence test. This will give us the first look at the shape of the legislation on this and, the rules that will then apply from 4/13. This should bring some welcome clarity incl to many of the issues raised on this thread.

Statutory Residence Test - the next stage

HM Treasury have finally released their response to the consultation into implementing a statutory residence test from April 2013.

The document outlines a summary of the responses received and also highlights any refinements to the original proposals that have been made. There is some much welcome clarification on certain definitions within the proposed test, although invariably some question marks will remain.

It is a three-tier test, broken down into those who are conclusively non-resident, conclusively resident or if they do not apply, the connections an individual has with the UK and the number of days that they spend here are considered in the final test:

• Those who are conclusively non-resident will be
  
  • anyone present in the UK for fewer than 46 days if they have been non-resident in all of the previous three years, or
    
  • present for fewer than 16 days if they have been resident in one or more of the previous three years, or
    
  • work full-time abroad and are present in the UK for fewer than 90 days with no more than 20 days* spent working in the UK
    

* The consultation document outlines that the Government are requesting views on whether this should be increased to 25 days.

• Those who are conclusively resident will be:
  
  • Anyone present for more than 183 days in the tax year, or
    
  • Only has one home and that home is in the UK, or
    
  • Works full-time in the UK
    

  [*]If Parts A & B do not apply, then the number of connecting factors with the UK and the amount of time spent in the UK determines the status.

The response also contains draft legislation which runs to a staggering 62 pages! The Government believe that the outline provided is close to a final draft, however a further consultation period into the legislation, and one or two intended alterations, is to run until mid-September 2012.