reclaiming tax when leaving the UK
#1
Forum Regular
Thread Starter
Joined: May 2009
Location: Brisbane
Posts: 257
reclaiming tax when leaving the UK
I'm sure that someone posted a thread last year about being able to reclaim some of your tax back before you leave the country. If this is correct, is there a 'best' time to do this ie in March when you have probably paid the highest amount in one financial year, or does it just somehow depend upon your annual salary.
Also, if you can claim some tax back, are you able to claim it before you leave?
Thanks in advance
Also, if you can claim some tax back, are you able to claim it before you leave?
Thanks in advance
#2
Re: reclaiming tax when leaving the UK
If you leave the country before the end of the tax year and have no other income derived in the UK, then you can fill in the form P85 to claim it back. You can put in the claim as soon as you stop earning, it might not get processed before you leave, depends upon how big a gap you have really.
Most employed people, i.e. paid under PAYE will be entitled to a tax refund because their personal allowance will have been pro-rated but they will not have received the full benefit of it - which they are entitled to as it is as it an annual entitlement even if they are only in the country for, say,two months.
The further through the tax year somebody is the more of the personal allowance they will have used up and thus the smaller the tax refund. So I would expect somebody who leaves at the end of March to receive little to no rebate but somebody who leaves at the end of April will get a larger refund. I am not sure I would base a decision on when to leave on this though.
Most employed people, i.e. paid under PAYE will be entitled to a tax refund because their personal allowance will have been pro-rated but they will not have received the full benefit of it - which they are entitled to as it is as it an annual entitlement even if they are only in the country for, say,two months.
The further through the tax year somebody is the more of the personal allowance they will have used up and thus the smaller the tax refund. So I would expect somebody who leaves at the end of March to receive little to no rebate but somebody who leaves at the end of April will get a larger refund. I am not sure I would base a decision on when to leave on this though.
Last edited by Bermudashorts; Jan 3rd 2010 at 8:07 pm.
#3
Forum Regular
Thread Starter
Joined: May 2009
Location: Brisbane
Posts: 257
Re: reclaiming tax when leaving the UK
Thanks Bermudashorts - much appreciated
#4
Forum Regular
Thread Starter
Joined: May 2009
Location: Brisbane
Posts: 257
Re: reclaiming tax when leaving the UK
Just noticed on the P85 form they ask whether you will be renting. We will be renting and earning only about £150 per month although this will pay for my child maintenance and home insurance. Does this mean that I will not be able to claim anything?
#5
Just Joined
Joined: Feb 2008
Posts: 13
Re: reclaiming tax when leaving the UK
I wanted to add that we reclaimed using the P85 form when we left the UK in October last year and received our repayments direct into our banks in December. The whole thing was remarkable straightforward.
Sorry, we weren't renting out a house in the UK so I can't comment on that.
Sorry, we weren't renting out a house in the UK so I can't comment on that.
#6
Re: reclaiming tax when leaving the UK
The tax due on your rental income (less rental expenses) may well offset any tax rebate you are owed due to not have used your full personal allowance in your employment. It doesn't necessarily mean you won't get anything, it just needs to be taken into coinsideration.
#7
BE Enthusiast
Joined: Jan 2008
Location: Gold Coast, Australia
Posts: 363
Re: reclaiming tax when leaving the UK
I wanted to add that we reclaimed using the P85 form when we left the UK in October last year and received our repayments direct into our banks in December. The whole thing was remarkable straightforward.
Sorry, we weren't renting out a house in the UK so I can't comment on that.
Sorry, we weren't renting out a house in the UK so I can't comment on that.
#8
BE Enthusiast
Joined: Feb 2007
Location: Robina, GCoast
Posts: 473
Re: reclaiming tax when leaving the UK
Is the refund amount depending on your salary? (stupid question I know) just trying to work out is it worth completing the form is it pennies or pounds!
#9
Re: reclaiming tax when leaving the UK
The size of the refund is really more to do with how much unused personal allowance there is left over. So if two basic rate tax payers both put in the P85 at the same time (and PAYE had been correctly applied for both and they both have same tax code..) then they would get the same refund, even if one earned a lot more than the other. Same for two higher rate tax payers, they would get the same refund as each other but it would be larger than the basic rate payers refund.
(This assume salary is the only income)
Last edited by Bermudashorts; Jan 4th 2010 at 12:35 pm.
#10
Mikey82
Joined: Aug 2008
Location: Brisbane
Posts: 29
Re: reclaiming tax when leaving the UK
We left the uk end of January 2009 and didnt find out about the P85 until we arrived over here and speaking to others that had made the move. Anyway between Claire and myself we earned around £50k in 2008/2009 and completed our P85's and sent them off from oz along with our P45's. We were also renting our house out in the uk but not earning any profit as it doesnt even cover the mortgage, and you have to declare this on the P85. If renting your uk property out you must also complete an overseas landlord tax form (sorry do not recall the number) as this may well delay your P85 payout as it did mine!! claire got around £250 direct to our bank account after 6 weeks i think, and mines took around 6 months (after numerous phone calls from oz) but i got back £500 again direct to our nominated UK bank account.
Overall it was definitely worth doing, i think i would have done it even if it was less than £50!! End of the day whatever the amount its better in your pocket than the HMRC's.
Overall it was definitely worth doing, i think i would have done it even if it was less than £50!! End of the day whatever the amount its better in your pocket than the HMRC's.
Last edited by Mike82; Jan 4th 2010 at 11:30 pm. Reason: spelling edit
#11
Re: reclaiming tax when leaving the UK
Rent not covering mortgage does not necessarily mean you have not got profits chargeable to tax. Your mortgage is not fully allowable - only the interest component is.
#12
Forum Regular
Thread Starter
Joined: May 2009
Location: Brisbane
Posts: 257
Re: reclaiming tax when leaving the UK
Thanks Mike but can't you offset some of your tax in Australia against your financial loss on your UK rent? I also thought you would have both received more than what you did but who am I to know!!