Stock markets, shares and tax

[jonw8uk]

I'd like some advice from the more seasoned investors:

I'm a non resident Brit, and have non taxable status with regard to UK tax. I currently hold shares in both UK and US markets.

I don't have any plans on returning to the UK, but of course it can't be ruled out.

I bank in Jersey, and buy through the banks share dealing service. (this could probably be improved, as the bank has minimum balance requirements, pays no interest, and their share dealing transaction fees are relatively high - suggestions welcome??)

I'm planning/researching on building a longterm portfolio, but want to clarify my liability to taxes, when the time comes to start selling.

My understanding so far is that on UK stocks that I own, I would be liable for capital gains tax @28% after my personal allowance.

I have no other income arising in the UK.

On US stocks I will pay a 15% withholding tax (the paperwork has been filed to reduce this from 30%)

So based on this, the US market is where I should focus, or am I missing something?

Thanks in advance

[wordchild]

if you remain non resident you are not liable to pay cgt on UK (or US) shares. Even if you return to the UK as long as you have been non res for 5 or more full tax years there would be no liability for any gains taken whilst you were non resident. There is loads of stuff about all this on this site, in general UK shares are pretty tax efficient from a non residents perspective, certainly more so than US shares eg there is no withholding tax (for now) on UK dividends. However , depending on your domicile status (eg if you are a non Dom), holding UK shares could have implications for potential IHT liability on your estate.

Where your broker is located eg offshore or onshore UK doesn't have direct relevance to your tax position as long as you are bona fide non resident

If you want a non UK broker with reasonable charges there has been positive comment here on TD Direct in Luxembourg and also on Saxo (who now have an office in Singapore)

Edited February 23, 2016 by wordchild

[wordchild]

sorry double post

Edited February 23, 2016 by wordchild

[jonw8uk]

if you remain non resident you are not liable to pay cgt on UK (or US) shares. Even if you return to the UK as long as you have been non res for 5 or more full tax years there would be no liability for any gains taken whilst you were non resident. There is loads of stuff about all this on this site, in general UK shares are pretty tax efficient from a non residents perspective, certainly more so than US shares eg there is no withholding tax (for now) on UK dividends. However , depending on your domicile status (eg if you are a non Dom), holding UK shares could have implications for potential IHT liability on your estate.

Where your broker is located eg offshore or onshore UK doesn't have direct relevance to your tax position as long as you are bona fide non resident

If you want a non UK broker with reasonable charges there has been positive comment here on TD Direct in Luxembourg and also on Saxo (who now have an office in Singapore)

Thanks for the reply.

I was under the impression that any profit made when selling shares would be considered 'income arising in the UK' (even being non res) and thus be taxable. From what you've explained I see this isn't the case.

Cheers

[wordchild]

if you remain non resident you are not liable to pay cgt on UK (or US) shares. Even if you return to the UK as long as you have been non res for 5 or more full tax years there would be no liability for any gains taken whilst you were non resident. There is loads of stuff about all this on this site, in general UK shares are pretty tax efficient from a non residents perspective, certainly more so than US shares eg there is no withholding tax (for now) on UK dividends. However , depending on your domicile status (eg if you are a non Dom), holding UK shares could have implications for potential IHT liability on your estate.

Where your broker is located eg offshore or onshore UK doesn't have direct relevance to your tax position as long as you are bona fide non resident

If you want a non UK broker with reasonable charges there has been positive comment here on TD Direct in Luxembourg and also on Saxo (who now have an office in Singapore)

Thanks for the reply.

I was under the impression that any profit made when selling shares would be considered 'income arising in the UK' (even being non res) and thus be taxable. From what you've explained I see this isn't the case.

Cheers

shares and certain other financial assets are taxed differently from property for non residents; also (as well as no CGT) there is no income tax liability on dividends from UK shares.

Edited February 24, 2016 by wordchild