UK INHERITANCE EVEN THOUGH RESIDENT IN CANADA
May 22nd 2008, 12:06 pm
#16
Lovin it!
Joined: Feb 2008
Location: Windsor, ON
Posts: 279
Re: UK INHERITANCE EVEN THOUGH RESIDENT IN CANADA
u trust the government I usually like reading your posts they always have me in stitches but surely you are not serious on this 1...
May 22nd 2008, 12:36 pm
#17
BE Enthusiast
Joined: Dec 2007
Location: Northants (though hopefully not forever!)
Posts: 636
Re: UK INHERITANCE EVEN THOUGH RESIDENT IN CANADA
Your friend may wish to re-train. If I die in Canada, with assets in a Canadian province, my will is probated in my province of residence at the time of my death, or the province where the will is lodged and I am ordinarily resident. UK tax authorities have no say and will not even be notified.
''If you die in a country which has a tax treaty with the UK that treaty will contain exchange of information clauses so the foreign tax authority may inform the UK about your death. If none of this applies then it is unlikely, but not impossible, that the UK will find out but why take the risk? You will be potentially liable unless you obtain a ruling that you are non UK domiciled. The cost of getting the ruling is small. The cost of doing nothing may be huge. This is insurance against a 40% tax bill''.
IS there a mutual tax treaty between the UK and Canada....?
I like how they say 'why take the risk?' - the obvious answer being 'because I don't wanna give 40% of my hard-earned Canadian bucks to you!' ?!
I can't see the benefit of retaining one's UK passport, or am I missing something here? You can travel anywhere on a Canadian passport so won't limit you to going back and forth b'twn the UK...
Interesting thread
May 22nd 2008, 1:18 pm
#18
Magnificently Withering
Joined: Jan 2007
Location: Oakville, ON
Posts: 6,892
May 22nd 2008, 1:30 pm
#19
rolling uphill
Joined: Jan 2008
Location: Etobicoke, ON
Posts: 419
Re: UK INHERITANCE EVEN THOUGH RESIDENT IN CANADA
From the page quoted at the start of this thread: 'If you are domiciled abroad, inheritance tax applies only to your UK assets.'
For those of us with zero assets in the UK, that means zilch tax. Nothing to worry about. HMRC can be informed all they like, but if my assets (such as they are) are all in Canada, then it's Revenue Canada that gets the tax. Or am I wrong?
I incidentally like the examples given at the bottom of the page. So the UK isn't Utopia, then? I demand my money back!
For those of us with zero assets in the UK, that means zilch tax. Nothing to worry about. HMRC can be informed all they like, but if my assets (such as they are) are all in Canada, then it's Revenue Canada that gets the tax. Or am I wrong?
I incidentally like the examples given at the bottom of the page. So the UK isn't Utopia, then? I demand my money back!
May 22nd 2008, 2:26 pm
#20
Joined: Feb 2007
Posts: 3,020
Re: UK INHERITANCE EVEN THOUGH RESIDENT IN CANADA
Why not? People are inherently selfish and are only concerned about looking after "their own". The more money the treasury can make through taxing the estate of dead people, the more they can potentially reduce the tax burden on the poorest members of society.
May 22nd 2008, 2:29 pm
#21
Forum Regular
Joined: Jan 2006
Location: Oakville, Ontario
Posts: 180
Re: UK INHERITANCE EVEN THOUGH RESIDENT IN CANADA
Of course that is what the treasury will do.
May 22nd 2008, 3:12 pm
#26
Joined: Feb 2007
Posts: 3,020
Re: UK INHERITANCE EVEN THOUGH RESIDENT IN CANADA
What is it with you? It's like being stalked by an angry toddler. Some sort of argument would be a lot more fun than the constant "I don't like you. You're a prat" stream of drivel.
May 22nd 2008, 4:08 pm
#29
Binned by Muderators
Joined: Jul 2007
Location: White Rock BC
Posts: 11,684
Re: UK INHERITANCE EVEN THOUGH RESIDENT IN CANADA
Good point. However I've just found this:-
''If you die in a country which has a tax treaty with the UK that treaty will contain exchange of information clauses so the foreign tax authority may inform the UK about your death. If none of this applies then it is unlikely, but not impossible, that the UK will find out but why take the risk? You will be potentially liable unless you obtain a ruling that you are non UK domiciled. The cost of getting the ruling is small. The cost of doing nothing may be huge. This is insurance against a 40% tax bill''.
IS there a mutual tax treaty between the UK and Canada....?
''If you die in a country which has a tax treaty with the UK that treaty will contain exchange of information clauses so the foreign tax authority may inform the UK about your death. If none of this applies then it is unlikely, but not impossible, that the UK will find out but why take the risk? You will be potentially liable unless you obtain a ruling that you are non UK domiciled. The cost of getting the ruling is small. The cost of doing nothing may be huge. This is insurance against a 40% tax bill''.
IS there a mutual tax treaty between the UK and Canada....?
The Canada / UK tax treaty is specific about the taxes it deals with, and Inheritance Tax isn't one of them. The provisions for information exchange are only for the taxes covered by the treaty.
I am not sure of the value of a ruling (is this from HMRC?) as you domicile can change at any time.
Domicile is a question of fact. To lose your UK domicile you have to physically move to another country and intend to live there permanently. It doesn't matter if you live and work in Canada for 40 years, if you intention is to retire back in the UK you will remain domiciled in the UK all of this time. I can see why retaining an up to date British passport would be one factor that could be considered in establishing a person's domicile, but not a conclusive one. It is certainly not necessary to renounce your British citizenship to be domiciled out of the UK.
If your life plan is to leave the UK at age 20. Live and work in Canada till the age of 60, then retire to the US, you will remain domiciled in the UK until the age of 60. This is because you never intended to live permanently in Canada. You would lose your UK domicile after the age of 60 because you are physically resident in the USA and intend to live there until you die.
Having said all this, I am not aware of a single case where a resident of Canada has been subject to UK Inheritance Tax on their Canadian assets.
May 22nd 2008, 6:45 pm
#30
rolling uphill
Joined: Jan 2008
Location: Etobicoke, ON
Posts: 419
Re: UK INHERITANCE EVEN THOUGH RESIDENT IN CANADA
With reference to the quotation from HMRC (in my last post), I'm not in the least surprised. HMRC wouldn't be remotely interested in pursuing anyone for inheritance tax on assets that are in Canada, not the UK. That's Revenue Canada's job.