Pre Departure - Leaving The UK
If you are leaving the UK to migrate to countries such as Australia, or to live and work overseas as an expat you may have important tax planning and compliance questions to consider.
This can be a particular issue where a property in the UK is being retained and rented. For people in this situation there is likely to be a need to submit tax returns with HM Revenue as a non-resident.
For those who are non-resident for UK tax purposes and are selling a residential property in the UK must now also consider their capital gains tax position in the UK and reporting obligations both in the UK as well as in the country in which they are tax resident.
Inheritance Tax (IHT) planning is an issue of increasing importance for many, as an exposure to IHT is a function of an individual’s domicile status, rather than tax residency, athough being a tax resident of the UK can trigger or revive a UK domicile.
Indeed, even those who are not UK domiciled remain subject to IHT in the UK on their UK located estate.
If you have left or are leaving the UK partway through the tax year you need to consider your eligibility for split year treatment which will enable you to split the tax year into two parts.
Should you qualify for split year treatment and no longer be in receipt of any UK sourced income you can make a claim for a tax refund due to unused personal allowances by preparing a form P85 leaving the UK.
If during a year you either start to live or work overseas – or come to the UK from overseas to live or work in the UK – the tax year will be split into two parts if your circumstances meet specific criteria:
- A UK part, for which you are charged to UK tax as a UK resident.
- An overseas part for which, for most purposes, you are charged to UK tax as a non-UK resident.
As a non UK tax resident you will need to lodge a UK Tax Return with HM Revenue & Customs if you have:
- Income from renting out a UK property including your main residence.
- Income from savings, investments and dividends.
- Any other UK untaxed income.
You will need to register for self assessment and lodge a UK Tax Return if not already registered.
If you are required to lodge a UK Tax Return you will need to register for self assessment and obtain a UTR number to enable you to lodge a Tax Return.
You can register online via HMRC website or we can assist you by preparing a form SA1 registering you for Self Assessment and submitting to HMRC on your behalf.
The filing deadline will vary depending of whether you are lodging a paper or electronic tax return:
- For paper submission the filing deadline is 31 October.
- For electronic submission (commercial software or accountant) the filing deadline is 31 January .
We at GM Tax provide fixed fee quotes for advisory work and tax returns.
If you are leaving the UK and would like a fixed fee proposal from a firm of UK & Australian tax advisors that understands the issues affecting individuals leaving the UK please complete our online enquiry via our contact us button or by calling a GM Tax office closest to you.
GM Tax also offers the following services:
- Tax planning advice and guidance with regards to your residency status in the UK, eligibility for split year treatment and also domicile status in the context of Inheritance Tax (IHT) planning.
- Preparation of UK tax returns, with all returns submitted to HM Revenue electronically where possible.
- Advice on the tax position where a property in the UK is being let while a taxpayer is living overseas.
- Assistance to ensure UK source income of those who are non-residents of the UK is properly taxed and is not taxed twice, or double taxed.
- This last point is particularly relevant to those who have UK source income or capital gains which may also be subject to tax in the country in which the taxpayer is now resident.