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Moving to Dubai to sell overseas company?

Moving to Dubai to sell overseas company?

Old Feb 20th 2021, 10:20 am
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Default Moving to Dubai to sell overseas company?

Hi all,

I'm currently a UK tax-resident but will soon be selling a HK-based company of which I'm the sole shareholder.

Of course, if possible, I'd like to (eventually) get this money back into a UK bank account while minimising my UK CGT liability.

I'm being advised that the way to do this would be to sell the company while I'm a tax resident in a country in which income tax is 0, so for example, living in Dubai for a tax year, during which I sell the company and transfer the proceeds from the HK business bank account to a British bank account (but not declaring it to HMRC as I'm no longer a UK tax resident).

I'm aware that, at some point, I'll probably have to hire a professional to advise me on an exact plan, but first wanted your guys' opinion on whether or not I'm looking at the right kind of rough plan.

Many thanks!
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Old Feb 20th 2021, 10:36 am
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Default Re: Moving to Dubai to sell overseas company?

Get professional advice. Income Tax and CGT are different and you'll be liable for both. To become UK Non-Resident for Income Tax purposes takes at least one full tax year out of the UK with limited visits. CGT liability lasts 5 complete tax years, from memory.

Last edited by Johnnyboy11; Feb 20th 2021 at 12:36 pm.
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Old Feb 20th 2021, 12:00 pm
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Default Re: Moving to Dubai to sell overseas company?

Originally Posted by Johnnyboy11 View Post
Get professional advice. Income Tax and CGT are different and you'll be liable for both. To become UK Non-Resident for Income Tax purposes takes at least one full tax year out of the UK with limited visits. CGC liability lasts 5 complete tax years, from memory.
Oh right, thanks for that. I'll certainly have to look into that rule then. Happy to go out to Dubai for a year but 5 would be pushing it to be honest!
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Old Feb 20th 2021, 1:26 pm
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Default Re: Moving to Dubai to sell overseas company?

Again - reiterate the need to get proper advice. perhaps adding in a corporate layer and selling off the subsidiary whilst keeping the cash in the old Hk parent company may be an approach. Hk does not have capital gains tax. The UK may look through the structure though. There are better places to hang out for a while for zero CGT. Singaproe springs to mind, as does Hk.

Also depends if you can try and claim non-dom status in the Uk and use the cash outside the UK.
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Old Feb 20th 2021, 2:10 pm
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Default Re: Moving to Dubai to sell overseas company?

Not so easy just to go to Dubai for a year. Visa ?
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Old Feb 20th 2021, 4:44 pm
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Default Re: Moving to Dubai to sell overseas company?

Have them lend you the purchase price via a debenture secured on the shares of the company, default on the loan, have them enforce the security and take the shares. Have all the loan proceeds paid into an offshore account somewhere opaque, Dubai. Filter money back slowly as income.

Using my free taxation advice comes at your own risk.
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Old Feb 21st 2021, 11:20 am
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Default Re: Moving to Dubai to sell overseas company?

Originally Posted by Millhouse View Post
Have them lend you the purchase price via a debenture secured on the shares of the company, default on the loan, have them enforce the security and take the shares. Have all the loan proceeds paid into an offshore account somewhere opaque, Dubai. Filter money back slowly as income.

Using my free taxation advice comes at your own risk.
seems legit - do it!
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Old Feb 21st 2021, 12:05 pm
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Default Re: Moving to Dubai to sell overseas company?

Thanks all for your advice, I'm quickly realising that this is very case-dependent and as such, there's no set way to do something like this. Professional advice it is!
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Old Feb 22nd 2021, 3:25 am
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Default Re: Moving to Dubai to sell overseas company?

Originally Posted by Millhouse View Post
Have them lend you the purchase price via a debenture secured on the shares of the company, default on the loan, have them enforce the security and take the shares. Have all the loan proceeds paid into an offshore account somewhere opaque, Dubai. Filter money back slowly as income.

Using my free taxation advice comes at your own risk.
I was going to suggest buying a couple of tonnes of cocaine with the proceeds and shipping it home for sale and distribution at your leisure. However MH's suggestion seems less likely to attract sniffer dogs in the airport.

A nice HK accountant may be able to verify that the sale just covers ongoing director funded losses in the business and suitably lower any tax liability.

Last edited by weasel decentral; Feb 22nd 2021 at 3:31 am.
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