kittycat1

Hi all,

I have a question regarding tax and leaving Dubai.

If you have completed a full tax year obviously you do not pay tax on that period. What happens when you work say 4 months of the next tax year and then head back to the UK - do you have to pay tax on that money as it is not a full tax year? Or is it only on work done in the UK that you would pay tax on?

This bit gets a bit complicated;
If you have a short term job directly after leaving Dubai (spending 3 weeks in the UK before traveling to the job) that is not based in the UK, half paid into your UAE bank account before you leave the UAE, half into your Uk account upon completion of the job would you have to pay tax on that? Invoices would be done in two parts. The client is not based in the UK if that makes any difference. Or do you just have an offshore account that it is paid into so it does not go into a UK account?

Would it be worth spending the rest of the year traveling so that you spend less than the 90 days in the UK to avoid any tax?

Thanks for your help (Meow)

Kittycat
xxx

Hello.Kitty

Meow

Q1 If you spend just four months out of a tax year abroad then you will be treated as UK resident for tax purposes for the whole year and will also be liable for UK tax on your overseas earnings in the whole year. (This changes of you have spend five full tax years as UK non-resident for tax purposes).

Q2 It sounds as if the person would retain their non-resident status in the tax year. if this is the case only income arising in the UK would be liable for UK tax.

I hope that clarifies.

Atilla

I am not long back from UAE. I went out in Jan 2008 and came back in Aug 2010. HMRC apply 'split tax year' principle, not liable for any tax, including the partial tax year before the first full tax year or the partial tax year in my least year. In short, as long as you do at least one full tax year you are not liable for tax.

Meow

The split year concession (not concession not a guaranteed ruling) applies provided a certain amount of time in a tax year is spent outside the UK (as well as one full year). It does not apply to any income arising in the UK.

Atilla

Agreed. My point was solely re UAE income.