Paying of UK debt
 

Hi all,

I have a several thousand pounds worth of debt in the UK, credit cards, bank loan and overdraft, that I am hoping to clear over the next month or so, but am not sure where I stand with transferring money back into a UK bank account, a friend told me that any money I transfer into a UK account would be liable for tax in the UK, however I was under the understanding that if its money you earn in the UK that you would have to pay tax, if its earnt in Dubai it would be tax free- an anyone clear this up for me?

Form this also the best place to save money would be a offshore bank account, can anyone recommend one and give me a web link please. Thanks

Cheers

Kittycat
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Re: Paying of UK debt
 

You wanna speak to Meow about this,, good luck though - I've been here two and a half years and paid nowt of my UK debts off.

Which is pretty terrible really.

Re: Paying of UK debt
 

Any advice be really appreciated. I intend to leave UK in August to start work in Riyadh and really hoping to pay off my mortgage in couple of years while working there. For that matter I will have to transfer funds to UK. Will I be liable for tax? Is there any other "efficient" way?

Thanx
Aliyairfan:confused:

Re: Paying of UK debt
 

u are allowed to send some money back, and i believe if you have done your 1tax year out of country then you will not pay tax on it but meow will come on and tell u.

Re: Paying of UK debt
 

Here you go.:)

http://www.offshore.hsbc.com/1/2/international/home

Re: Paying of UK debt
 

Hi, I am new to the UAE and also aiming to pay off UK credit cards etc and need to move money back to the UK. I am also still paying into UK ISA's (tax free savings accounts for UK residents) should I stop these and other UK based savings and investment plans like the old endowment policy I have?

Thanks in advance.

Re: Paying of UK debt
 

Once you have cleared a tax year you are not liable for any tax on income earnt in the UAE. How long are you planning to be in the UAE? Have you informed the tax man? Where are you paid on UAE income and how are you transfering money back?

Feel free to PM me, I'm a Financial Advisor when I'm not ranting in these forums.

N.

Re: Paying of UK debt
 

You have to tell the HMRC on a form P85 that you wish to be non domiciled. Then if you stay away for a full tax year ie: April to April you will not be liable for UK tax.
But in the mean time you can send any money home to pay debt. However if you put it into any investment or aving in the UK the interest you earn will be taxable.
Therefore it is best to pay your debt off first, then start saving/investing.
Peter

Re: Paying of UK debt
 

Hey Norm,

My contract is for another 28 months, I've been here 8 so haven't done a full tax year yet. Yes the taxman has been informed. My salary is paid into a UAE HSBC bank account and to date I have been transferring money back into my UK account via western union- just enough to cover my minimum payments to date.

Was planning on sending several thousand pounds back over the next few weeks.

Happy to keep the conversation open so other people an see what to do.

Thanks for your help Norm

xxx

Re: Paying of UK debt
 

Isn't Western Union expensive? If you have HSBC can't you do an internal transfer back to Blighty? I am interested to know which is the cheapest way to transfer funds money.

Re: Paying of UK debt
 

Sounds like you're already doing the right thing already if you've already sent the taxman a P85 and are keeping up with minimum payments.

There might be better options than western union for sending money back home, especially larger amounts. I know a currency transfer company that can offer better rates for large amounts or regular transfers.

You would do well to shop around a bit if opening an offshore account as the charges for some accounts are quite high really if you don't keep the minimum balance.

Hope that helps.

N.

Re: Paying of UK debt
 

If you are here in Dubai - you can use Al Rostamani exchange - in mall MOE & Ibn batttua - i find there exchange rates competitive and charges are 45dh each transaction.

Re: Paying of UK debt
 

Provided you are UK non-resident for tax purposes in this tax year, then you can send your overseas income to the UK without any liability to UK income tax. The situation with capital is different.

I am agencies with a couple of offshore banks so can assist with account opening. Rates are lousy (everywhere) but these banks have low minimums unlike many operating here.

If transfering money to Sterling, higher amounts (AED 30k +) can benefit from wholesale exchange rates, much better than your bank offers, without fees.

Oh yeah. I'm a qualified independent financial adviser...

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Re: Paying of UK debt
 

I have been in the UAE for almost 2 yrs - from day one i opened up an account with both HSBC and LLOYDS.

My salary gets paid into HSBC...i then tranfers from my HSBC acct into my LLOYDS acct, who then transfer the funds into my IOM offshore account.

from there i then transfer into my UK bank account whatever funds i need to pay my monthly SO/DD's and other credit card debts.

I have had no issues with the IR....i filled out a P85 on moving out here - and have completed one tax return, since I have rental income from my property in London.

All is well so far.

As long as you stay out of the country for two consecutive calender yrs (ie one full financial year) you pay no taxes on any income.

Re: Paying of UK debt
 

So you could be paying up to four sets of transfer fees. I'd reconsider that if I were you.

Calendar years have nothing to do with UK tax liability. Only tax years, 6th April to 5th April, are relevant.

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