jimmyjazz2

Hi All, thank you for your replies.
Think I understand the SA109 form a bit better now.

looks like, I was confusing, making a remittance and claiming the remittance
tax basis.
No cross in box 28 ( making a claim on the remittance basis 2016-2017)
Put a cross in box 29
( if your remitted income and capital gains for 2016-2017 is less than 2000 GBP,)
as it is. I had no income after 2014, just blowing my savings!!!!!!!!
i will use the arising tax basis, as i have no income apart from uk rental income.
im happy to pay tax on that, well almost happy


Now I need to sort my residence status out for 2016-2017.

I had 154 days in uk, all days were consecutive in the UK,
(stayed at different friends houses all the time)
The other 211 days were at my home, out side the uk.
(it's been my home from 2001 to present, I also have a retirement visa form
2014 onwards at my non uk country home)

Im just a bit confused about the 30 and 91 days rules for this test, do they apply to me when i have a permanent home out side the uk available all year round to me. ?

just on this basis, do I pass the second automatic uk test ?
anyone know ?

Thank you all again.
and Happy new year to you all.
Royboy1

Vadio

@jimmyjazz2 -

AFAIK, it does not matter. No different to living and working in a country with a lower tax rate. You were in tax utopia!


The UK has a residence based taxation system. You didn't live here or earn income here so it's not taxed here just because you came back and brought the funds with you. The income produced by the investment property is subject to tax as is interest earned if you still have offshore accounts since you now live here.

Vadio

As they say in basketball, no harm, no foul. I'm all thumbs at times on my laptop, never mind one of my tablets or my phone.

jimmyjazz2

Hi Vadio
Thank you very much for your reply. yes no tax due, only the rental income will be taxed.

But i dont live in the uk, i left after 154 days, and would like to keep
my non residence status, so that's the reason I was asking about, the second automatic residence test.

Vadio

My brief read of this (https://www.expertsforexpats.com/exp...esidence-test/) suggests that the automatic residence test does not apply.

You spent fewer than 183 days, and you have a home abroad. You did not have a home in the UK. Further, you didn't work in the UK and did not receive any UK source income from work.

I would carry on and not worry about it. File your SA as a non-resident, and stop thinking that the money you brought into the UK to buy the investment property is a remittance. For tax purposes, it was not; it was simply use of funds accumulated while living/working abroad (and not UK resident) that you chose to invest in the UK.

jimmyjazz2

Hi Vadio, thank you very much for your reply.
yes, I agree with you.

But the SA109 first question requires an answer of resident status.
As I failed the automatic over sea tests.
Test 1) I was in the UK more than 16 days,
Test 2) in the UK more than 46 days,
Test 3) work over seas test, does not apply to me as I'm retired, I assume I failed and must go onto the Automatic UK tests. ?
Hence all the questions about, the second automatic UK test.
and time and what is called a home after a sufficient amount of time.
Maybe I'm reading to much into this form
but i just wish to put the correct information on the form

Thank you again Vadio
Royboy1

Vadio

Let's go back to basics. You've started filling out an SA100 to report income received from the investment property you bought during the 2016/2017 tax year.

You came to the UK and bought the property, lived with friends, and used savings earned prior to the 2016/2017 tax year to buy the property and support yourself while in the UK. You have no other ties here; no kids in school, no spouse, no home of your own, and don't work in the UK (or anywhere else at this point). You 'home' is, and wil continue to be, outside the UK.

Your confusion began when you started confusing 'remittance basis' for income with the simple act of using funds accumulated while working/living abroad to buy a property in the UK as an investment. It was further confused because you live in a place which never taxed the income you earned.

For now, forget the SA109. Go back to the SA100. Starting with page 4, I assume the answers to questions 1-3 are "no"; question 4 is a "yes". I also assume questions 5-7 are "no". Question 8 is yes, as you were not in the UK for more than 183 days and therefore a non-resident. Forget question 9 for now, and go to page 5 (income). Fill in anything that applies (possibly untaxed foreign interest??) go through the rest of the form, and answer as appropriate.

Now - SA105 is required to report the rental income you received. SA109 is required if you are non-resident, and here's where you start complicating you situation.

I presume you started with this: https://www.gov.uk/government/public...dence-test-srt

Your relevant pages start with page 17. The 1st automatic UK test doesn't apply as you were not in the UK for 183 days during the tax year. So move to the 2nd automatic test. The first part is not relevant as you did not, and do not, own a 'home' which was available for your use. Reading through the examples, there are of course instances when 'accommodation' can be considered your 'home'. Foe this you need to jump to Annex A on page 86, and read through carefully. Also consider page 16, which is the accommodation tie. If you truly stayed with friends, not a relative listed, then it is doubtful that anyone will give you an open invitation to stay for 91 days or more - the fact that you stayed with 2 different friends points to that. Therefore, I would assume that the 'accommodation' is not a 'home' for tax purposes. The 16 days only applies if you stayed with a relative. Reading through all the other info, it seems to me that you are NOT automatically tax resident for the 2016/2017 tax year. (Check out the chart on Page 22; seems to me that you are not UK resident under this test. If you have no other ties, that pretty much settles the matter.)

Further, even if you WERE resident, the taxable income would only be income earned (interest, salary, investment income, whatever) DURING the tax year and either 1) remitted to the UK or 2) taxable under the arising basis.

For purposes of the SA100 and SA109, forget about the £140K you brought over to buy the investment property and the £11K you used for living expenses. This is not 2016/2017 income, and is not relevant. Forget about it completely. End of.

Just step back and fill out the forms, and stop overthinking everything. Just get the return filed before January 31 and get on with your life.

Again - I am not a tax advisor or expert. Just a firm believer that it's best not to read too much into things. Good luck.

jimmyjazz2

Hi Vadio.
Thank you very much for your reply.
I know you spent a lot of time and effort doing that, thank you again.
Yes your correct on all accounts.
I have just been reading to much into all this and had gone into panic mode.
Never had to do a uk tax return in 17 years.
Thanks again for your time and help, your a Star.
Have a happy new year.

Vadio

You're welcome.

It did take a bit of time, but I enjoyed working on it. Added to my knowledge base as well.