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Old Sep 14th 2017, 7:26 am   #61
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Default Re: Pensions - escaping UK taxation

Read through with great interest as it's coming up a year since we left blighty. Currently house is rented out and I am using a friends address as an accommodation address, so was all looking good but I think my recent agreement to do a bit of part time support work on a self-employed basis for a previous employer may have scuppered my chances of making a clean break with HMRC. That's had me reactivating my UK company so that they can pay it for my services I have a feeling trying to be a non resident company director (albeit on a tiny scale) may well be too complex, we're not talking significant enough sums that paying lots for complicated tax structures is worth consideration. My accountant feels it's out of his comfort zone. Certainly it's beyond me working out from HMRC guidance.
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Old Sep 14th 2017, 8:06 am   #62
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Default Re: Pensions - escaping UK taxation

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Originally Posted by IanBlakeley View Post
Read through with great interest as it's coming up a year since we left blighty. Currently house is rented out and I am using a friends address as an accommodation address, so was all looking good but I think my recent agreement to do a bit of part time support work on a self-employed basis for a previous employer may have scuppered my chances of making a clean break with HMRC. That's had me reactivating my UK company so that they can pay it for my services I have a feeling trying to be a non resident company director (albeit on a tiny scale) may well be too complex, we're not talking significant enough sums that paying lots for complicated tax structures is worth consideration. My accountant feels it's out of his comfort zone. Certainly it's beyond me working out from HMRC guidance.
Ian I am by no means an expert on tax issues so please consider this carefully and draw your own conclusions.
The first port of call when trying to work out your tax liability in UK and Malaysia should be https://www.gov.uk/government/upload...-_in_force.pdf. From my reading of this, even if you are a resident of Malaysia if you are earning income in the UK you are liable for taxation of that income in the UK. But do scan down through the articles as there are a number of categories for which the general rules may be slightly amended so make sure you do not fall into one of these.

Hope this helps, in my experience writing to HMRC will not get you a very helpful answer. But if you do your research and determine your best outcome just tell HMRC what you are doing and why. They must play by the same rulebook and will only challenge you if you get it mighty wrong.
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Old Sep 15th 2017, 12:51 pm   #63
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Default Re: Pensions - escaping UK taxation

I've been retired for nearly 20 years so things will have changed, probably.

But it used to be that any money earned in UK whether salary, or rental income was subject to UK tax even if the earner was non resident in UK. If those earnings were above the allowances available of course.

Also to become non resident you had to have spent a full tax year outside UK, April to April not say September to September if you wanted your ex UK earnings to be non taxable.

Dunno if those conditions are still the case but I'd be interested to know if things have changed and what those changes are.

Last edited by ex reg; Sep 15th 2017 at 12:54 pm.
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Old Sep 16th 2017, 8:06 am   #64
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Default Re: Pensions - escaping UK taxation

If you are not UK tax resident and receiving salary for work done outside the UK, then this income is not earned in the UK, even when paid by a UK company, and shouldn't not be taxed in UK.
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Old Sep 16th 2017, 10:19 am   #65
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Default Re: Pensions - escaping UK taxation

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If you are not UK tax resident and receiving salary for work done outside the UK, then this income is not earned in the UK, even when paid by a UK company, and shouldn't not be taxed in UK.
I don't think that is correct as Ian states that he has "reactivated" his UK company. Assuming he is a director and paid through that company he should be aware that a non-resident director of a UK company is an office holder, and any income received in respect of this UK role will be treated as earnings in the UK and subject to UK wage tax withholding (“PAYE”).

Double tax treaties do not usually offer any protection in this regard. However, if the individual is not remunerated in any way, either by the UK or overseas entities for the UK directorship, there will be no UK tax liability.
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Old Sep 16th 2017, 10:28 am   #66
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Default Re: Pensions - escaping UK taxation

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Originally Posted by InVinoVeritas View Post
I don't think that is correct as Ian states that he has "reactivated" his UK company. Assuming he is a director and paid through that company he should be aware that a non-resident director of a UK company is an office holder, and any income received in respect of this UK role will be treated as earnings in the UK and subject to UK wage tax withholding (“PAYE”).

Double tax treaties do not usually offer any protection in this regard. However, if the individual is not remunerated in any way, either by the UK or overseas entities for the UK directorship, there will be no UK tax liability.
I have researched this in the past. And several accountants says that hmrc will only tax director services performed in the UK.
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Old Sep 20th 2017, 3:56 am   #67
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Default Re: Pensions - escaping UK taxation

Quote:
Originally Posted by IanBlakeley View Post
Read through with great interest as it's coming up a year since we left blighty. Currently house is rented out and I am using a friends address as an accommodation address, so was all looking good but I think my recent agreement to do a bit of part time support work on a self-employed basis for a previous employer may have scuppered my chances of making a clean break with HMRC. That's had me reactivating my UK company so that they can pay it for my services I have a feeling trying to be a non resident company director (albeit on a tiny scale) may well be too complex, we're not talking significant enough sums that paying lots for complicated tax structures is worth consideration. My accountant feels it's out of his comfort zone. Certainly it's beyond me working out from HMRC guidance.
Ian,

I have an active UK company and am presently a non tax resident of the UK (company contains retained earnings from previous years). I have chosen to not pay myself a salary and am looking at taking some of those retained earnings out as dividends. Check with your accountant but as a non UK tax resident those dividends will not be taxed (provided you do not become a UK tax resident again in the next 5 years), and as a Malaysian tax resident offshore earnings are not taxed. You will of course have to pay UK company tax on any earnings you make. Worth checking and doing the sums to see if worthwhile.
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Old Sep 20th 2017, 7:10 am   #68
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Default Re: Pensions - escaping UK taxation

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Ian,

I have an active UK company and am presently a non tax resident of the UK (company contains retained earnings from previous years). I have chosen to not pay myself a salary and am looking at taking some of those retained earnings out as dividends. Check with your accountant but as a non UK tax resident those dividends will not be taxed (provided you do not become a UK tax resident again in the next 5 years), and as a Malaysian tax resident offshore earnings are not taxed. You will of course have to pay UK company tax on any earnings you make. Worth checking and doing the sums to see if worthwhile.
What you say is correct Simon but Ian's circumstances are rather different in that his UK company has been paid for services he has himself performed in the UK. I don't think HMRC are going to look kindly on him taking the income from this as dividends paid to him later as a non-resident director (perhaps the only director).

Without wishing to add to Ian's problems he needs to carefully consider how HMRC may view his claim to be non-resident in light of his work and accommodation address. The risk is that any other UK income he may have could be at risk of being taxed if he comes under HMRC scrutiny.
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