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Online UK business but moving to Canada - Tax, credits etc question

Online UK business but moving to Canada - Tax, credits etc question

Old Feb 16th 2011, 9:27 am
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Default Online UK business but moving to Canada - Tax, credits etc question

We (family of four - 2 adults and 2 children) wish to move to Canada from the UK. We qualify for the skilled progamme, get +70 points hands up. Currently waiting to do the language test.

Some time back we also set up a part time online business on autopilot here in the UK. It grew a little and now we have a small part time internet based business and one of us are registered as self employed (not much, lets say pocket money). The business is internet based and can be run from anywhere. We will continue to pay British national insurance and will receive the income in a British bank. In addition, we wish to rent our mortgage free house and pay the tax on rent in the UK.

My question is will we be in receipt of any benefits such as child benefits, tax credits etc in the UK. It's not that I want to take them, it's just that we wish to remain British Nationals and come back to live here later.
I would be grateful for your answers.
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Old Feb 16th 2011, 10:41 am
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Default Re: Online UK business but moving to Canada - Tax, credits etc question

Originally Posted by insearchoflife
We (family of four - 2 adults and 2 children) wish to move to Canada from the UK. We qualify for the skilled progamme, get +70 points hands up. Currently waiting to do the language test.

Some time back we also set up a part time online business on autopilot here in the UK. It grew a little and now we have a small part time internet based business and one of us are registered as self employed (not much, lets say pocket money). The business is internet based and can be run from anywhere. We will continue to pay British national insurance and will receive the income in a British bank. In addition, we wish to rent our mortgage free house and pay the tax on rent in the UK.

My question is will we be in receipt of any benefits such as child benefits, tax credits etc in the UK. It's not that I want to take them, it's just that we wish to remain British Nationals and come back to live here later.
I would be grateful for your answers.
You would only be eligible for them when resident in the UK - so you'd have to inform the authorities that you've leaving for Canada and your payments would be stopped, but when you return for good you would then be eligible for them again.


Last edited by christmasoompa; Feb 16th 2011 at 10:47 am.
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Old Feb 16th 2011, 10:58 am
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Default Re: Online UK business but moving to Canada - Tax, credits etc question

I assume you would be eligible for Canadian child benefit payments etc once you live there (if there is such a thing).
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Old Feb 16th 2011, 12:05 pm
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Default Re: Online UK business but moving to Canada - Tax, credits etc question

Originally Posted by christmasoompa
You would only be eligible for them when resident in the UK - so you'd have to inform the authorities that you've leaving for Canada and your payments would be stopped, but when you return for good you would then be eligible for them again.

In that case why should I pay income tax to her majesty and William's wedding?

Last edited by insearchoflife; Feb 16th 2011 at 12:20 pm.
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Old Feb 16th 2011, 12:22 pm
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Default Re: Online UK business but moving to Canada - Tax, credits etc question

Originally Posted by insearchoflife
In that case why should I pay income tax to her majesty?
You pay income tax on income earned in the UK and declared under the PAYE scheme. This is the case for everybody who eans an income in the UK and gets paid net of income tax. If you qualify for income support/child benefit etc in Canada you would receive them. Not everybody in the UK is entitled to these benefits either if their income is sufficient put them above the threshold. So these benefits are not a right even if you are UK resident and paying PAYE and NI contributions.
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Old Feb 16th 2011, 12:29 pm
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Default Re: Online UK business but moving to Canada - Tax, credits etc question

In that case it worth taking my things out of this country. With economy in shambles, rising inflation, 20% youth employment, spending cuts, miserable healthcare, road pot holes not being filled; its resembling the 3rd world.
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Old Feb 16th 2011, 12:32 pm
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Default Re: Online UK business but moving to Canada - Tax, credits etc question

Originally Posted by insearchoflife
We (family of four - 2 adults and 2 children) wish to move to Canada from the UK. We qualify for the skilled progamme, get +70 points hands up. Currently waiting to do the language test.

Some time back we also set up a part time online business on autopilot here in the UK. It grew a little and now we have a small part time internet based business and one of us are registered as self employed (not much, lets say pocket money). The business is internet based and can be run from anywhere. We will continue to pay British national insurance and will receive the income in a British bank. In addition, we wish to rent our mortgage free house and pay the tax on rent in the UK.

My question is will we be in receipt of any benefits such as child benefits, tax credits etc in the UK. It's not that I want to take them, it's just that we wish to remain British Nationals and come back to live here later.
I would be grateful for your answers.
You need to separate two concepts, citizenship and residency. Citizenship confers right of abode, in the UK in this case, and is independent of residency.

Benefits such as are paid for breeding are dependent on actual residency, you get child benefit when you're actually living in the UK.

Tax residency is a bit more negotiable but you're either tax resident in the UK or in Canada. If the latter, and I think that's what you'll have to be when actually resident here, you pay taxes on all your income, wherever the source, in Canada. You can't choose to have the rent and internet income taxed in the UK.
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Old Feb 16th 2011, 12:33 pm
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Default Re: Online UK business but moving to Canada - Tax, credits etc question

Originally Posted by insearchoflife
In that case it worth taking my things out of this country. With economy in shambles, rising inflation, 20% youth employment, spending cuts, miserable healthcare, road pot holes not being filled; its resembling the 3rd world.
Whereabouts in the "3rd world", is Surbiton now more like Namibia or Honduras?
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Old Feb 16th 2011, 12:33 pm
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Default Re: Online UK business but moving to Canada - Tax, credits etc question

Originally Posted by insearchoflife
In that case why should I pay income tax to her majesty and William's wedding?
Sorry, but why shouldn't you? You're earning money in the UK, so why not pay tax on it? If it were that easy the UK would be inundanted with people running businesses from there from abroad and not bothering to pay tax!

And it's nowhere near the 3rd world, don't be ridiculous. If you are leaving for Canada purely to escape the perceived negatives that you've listed, you're in for a big shock. The same problems exist anywhere I'm afraid, nowhere is Utopia!
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Old Feb 16th 2011, 12:35 pm
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Default Re: Online UK business but moving to Canada - Tax, credits etc question

Originally Posted by dbd33
Whereabouts in the "3rd world", is Surbiton now more like Namibia or Honduras?
Tom and Barbara Good would have a fit.
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Old Feb 16th 2011, 12:38 pm
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Default Re: Online UK business but moving to Canada - Tax, credits etc question

Originally Posted by Tangram
Tom and Barbara Good would have a fit.
It was them what done it! Destroying the infrastructure, digging up patios for vegetables, keeping fierce semi-domesticated chickens, it was them what started the slide into the primordial grunting existence the near humans in the UK now endure. When Tom put on them gumboots, that's when evolution reversed course.
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Old Feb 16th 2011, 12:43 pm
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Default Re: Online UK business but moving to Canada - Tax, credits etc question

Originally Posted by christmasoompa
Sorry, but why shouldn't you? You're earning money in the UK, so why not pay tax on it? If it were that easy the UK would be inundanted with people running businesses from there from abroad and not bothering to pay tax!

And it's nowhere near the 3rd world, don't be ridiculous. If you are leaving for Canada purely to escape the perceived negatives that you've listed, you're in for a big shock. The same problems exist anywhere I'm afraid, nowhere is Utopia!
Christmanoopma, thank you for your answer. I prefer to pay the income tax on the online business. Closing and opening would be more complicated with loss of income. As far as the rent is concerned, I can use the resources to rent over there.
Basically I do want to pay the contributions in the UK so that I can come back later with having paid enought NI contributions. I am not saying I want the UK child benefits but as I am paying NI and tax then I was guessing. I know a family living in Belgium who gets child benefits but then they might have different rules with the EU.

Last edited by insearchoflife; Feb 16th 2011 at 12:47 pm.
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Old Feb 16th 2011, 12:58 pm
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Default Re: Online UK business but moving to Canada - Tax, credits etc question

Originally Posted by insearchoflife
Christmanoopma, thank you for your answer. I prefer to pay the income tax on the online business. Closing and opening would be more complicated with loss of income. As far as the rent is concerned, I can use the resources to rent over there.
Basically I do want to pay the contributions in the UK so that I can come back later with having paid enought NI contributions. I am not saying I want the UK child benefits but as I am paying NI and tax then I was guessing. I know a family living in Belgium who gets child benefits but then they might have different rules with the EU.
The circumstances pertaining in Belgium have no bearing on those in Canada. Belgium is a 1st world country, even if the population do subsist on sea creatures of questionable gastronomical merit and there's an unpleasant indulgence of paedophilia under the legal system there. You can remit NI contributions from Canada, it's commonly done to maintain eligibility for a UK pension. You can continue to operate an internet based business when moving and just pay tax on the income in the new country rather than the old.
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Old Feb 16th 2011, 1:06 pm
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Default Re: Online UK business but moving to Canada - Tax, credits etc question

Thanks for that, beginning to make sense now. I prefer the income to be paid in the British bank as I will have some sort of income for later years. How does this relate now?

The scenario is this; want to work in Canada but get paid in the UK bank as usual and pay the necessary taxes and NI. Basically the business is such that one can work from from anywhere.

Perhaps I can't do that and better change and switch completely to the new country.

Last edited by insearchoflife; Feb 16th 2011 at 1:15 pm.
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Old Feb 16th 2011, 1:15 pm
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Default Re: Online UK business but moving to Canada - Tax, credits etc question

Originally Posted by insearchoflife
Thanks for that, beginning to make sense now. I prefer the income to be paid in the British bank as I will have some sort of income for later years. How does this relate now?

The scenario is this; want to work in Canada but get paid in the UK bank as usual. Basically the business is such that one can work from from anywhere.
If you have to pay tax on the income in the UK you claim that back on your Canadian tax return. This seems a cumbersome mechanism as it means you'll have to maintain contact with the UK tax authorities and you'll have to set up a UK bank account usable by a non-resident. I'd think it easier to have the money paid in Canada, perhaps in pounds, while you're in Canada and then paid in the UK when you're back in the UK.
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