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non residency - tax query

non residency - tax query

Old Sep 20th 2013, 3:06 pm
  #1  
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Default non residency - tax query

Hi guys new here. I moved out to Doha June 2012 initially to work for a local company. It took a long time for my works license to arrive (RP came after about a month) so i returned back to the UK. I then moved back to Doha in September to commence work. During this period June-Sept i received no income in either the UK or Qatar. My question is what date to i put from when i was first non resident - would i put down June or September?

Secondly (i know this is not the place for qualified information so i will also speak with an accountant), I dissolved a company earlier in the year in May 2012 and have some capital gains tax to pay. Is it necessary to pay this this tax year as i am now non resident. I read something on HMRC which states if you are non resident for 5 years then CGT is not payable?

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Old Sep 20th 2013, 4:14 pm
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Default Re: non residency - tax query

Welcome to the forum and to Doha!

See HMRC6 Section 8.5 for the rules around becoming UK non resident. For you, the key thing is to work full-time for a full tax year overseas (i.e. 'till 6th April 2015) and limit your visits to the UK. If you do this, there is a split-year concession available which means your non-residency starts from the day after you left the UK.

Google for 'Statutory Non Residency Test Flowchart' and take your pick - best way to understand how to become and remain Uk non resident.

Not so sure about capital gains, but it usually applies in the tax-year you realise the gains. You have allowances to reduce the hit.

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Old Sep 20th 2013, 4:19 pm
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Default Re: non residency - tax query

Thanks for the reply but i think you have missed the question i was asking. Would i put down June or September for the date from when first non resident?
Also the 1 full tax year would mean i would have to stay out until april 2014.

Which allowances do you mean that can reduce the hit?

Thanks again
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Old Sep 20th 2013, 5:17 pm
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Default Re: non residency - tax query

My apologies, I read September in your first post as being this month.

Put down the date you left the UK to work full-time abroad, as per HMRC6 8.5 guidance. From your first post, this looks like September 2012.

Assuming you are still working full-time overseas until 6th April 2014 and limit your UK visits, then you should be UK non resident from Sept 2012.

With regards Capital Gains, you were UK resident in 2012/13 so have an Exempt Amount of £10.6k.
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Old Oct 1st 2013, 1:40 am
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Default Re: non residency - tax query

Hello doha123.

When you wound up your UK company, did you make use of the CGT concessional basis - the old ESC C16 pathway?

Note that if you are tax resident in the UK at any time in a tax year that a capital gain arises the UK can tax the gain - unlike income where split year treatment would usually be claimed: income from outside the UK after ceasing to be resident is usually not taxed in the UK.

As Johnnyboy has said, there is a CGT Annual Exemption available to you in respect of a UK capital gain, and there may well be Entrepreneurs Relief available to you as well.

A gain arising in May 2012 should be declared on a 2013 UK tax return; the tax is payable on or before 31 Jan 2014.

In case of need: www.gmexpattax.com

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Old Oct 2nd 2013, 8:13 am
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Default Re: non residency - tax query

Hi Alan.
The company was wound up just after ESC16 so involved a members voluntary liquidation.
I will make use of the CGT annual allowance on the 2013 tax return. From what you have posted I assume as the gain was made in May 2012 and i moved here in September 2012, I will indeed need to pay the CGT owed, even though i was non-resident part way through the tax year?
I will also be making use of entrepreneurs relief - will this be something that is just ticked on the tax return?

Thanks
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Old Oct 2nd 2013, 8:19 am
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Default Re: non residency - tax query

Hi again doha123.

Yes, I anticipate that the gain is properly assessable in the UK.

Re Entrepreneur's Relief: see the info at this page on the HMRC website regarding the completion of SA108, the Capital Gains supplement to your 2013 UK tax return:
http://search2.hmrc.gov.uk/kb5/hmrc/...rd=jwrHAxRnsvo

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