theatty

Hello friends.

I am employed full time in the UK and will be moving to Dubai to live full time from late Nov/early December.

I already have a residency in Dubai, EID and bank account as my company was able to start the process early. I travel to Dubai once a month/every 6 weeks.

My question is will my income automatically be tax free when I arrive, or do I still have to pay income tax in the UK? Some people are saying that because I'm leaving the UK half way through the tax year I will have to pay tax on my earnings in Dubai.

This seems pretty unfavourable, but I just want to make sure I'm understanding it correctly. I imagine others may have had a similar set of questions when you moved to Dubai.

Does anybody know what I should be expecting?

Thanks in advance.

Johnnyboy11

You will be liable for full UK income tax and NI in your worldwide income until you become UK Non-Resident. Fastest way to achieve this is to work full-time overseas for a full tax year and to limit your days visiting and working in the UK (connecting factors apply). So 6th April 2018 at the earliest. If you meet the criteria, then a statutory concession kicks in and you are free of UK income tax from the day after you left the UK. NI liability might continue until the end of the tax year that you leave the UK, since your employer appears to have an office in the UK.

6th April 2018 is an important date for you...

theatty

Sounds like a really informed response. Thank you. So to be clear I won't pay any tax as long as I stay resident in Dubai? Or are you saying I will pay uk tax in Dubai until 2018. Still a bit confused. Thanks once again for your advice.

Johnnyboy11

When you leave the UK to work full-time abroad, you are given provisional UK Non-Resident status for UK tax purposes, so you shouldn't have to pay UK Income Tax on your Dubai earnings. You will be confirmed UK Non-Resident once you have completed working full time for a full tax year and limited your days visiting or working in the UK. So 6th April 2018 at the earliest.

If you don't meet these criteria e.g. You lose your job in Dubai and return to live in the UK before 6th April 2018, then you are likely to be considered by HMRC as having remained UK Resident throughout your time in Dubai, and therefore liable retrospectively to full UK Income Tax and NI on your worldwide earnings. Ouch!

You can check your UK Residency using this flowchart.

Best speak with a professional in this field, I can't give you advice.

Meow

Your tax liability depends on your residency status (see link to Statutory Residency Test article in link below which isn't new but is still correct) and you need to remain UK non-resident for tax purposes for a full tax year to avoid liability to UK Income tax on your overseas earnings. Watch the connecting factors.

https://financialuae.me/2013/02/12/i...esidency-test/

In respect of the partial years, depending on your specific situation, the Split Year Concession should apply which means that you would not have to pay tax on the partial years. This is a concession by HMRC, you have to meet certain criteria, and the rules can change.

(I do provide professional advice on these topics and more.)

brianjohns

Tell the tax man your leaving and you have full time employment abroad form p80 I think, you will have to pay tax on a split basis, send your p45 pages 2&3 if you have them.

Meow

It's a P85 and there are conditions that apply for the split year concession to apply. Note also that it is an concession, not a rule.