Taxing Question / How to handle Finances in a Tax Free Country- Saudi Arabia
Jun 1st 2009, 10:37 pm
#1
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Joined: May 2009
Posts: 19
Taxing Question / How to handle Finances in a Tax Free Country- Saudi Arabia
Sorry to bother you all but I could not find a thread in regards to how/if UK Tax Law could affect my earnings in Saudi.
I am offered a sub-contractor IT Consultancy Role in KSA as British expat. However, I am not sure how to handle my finances in a tax-free country.
The company is happy to EFT my salary account of my choice in anywhere in the world, so I do not get taxed on this but what happens once I move this money back to my main account in the UK.
I have no expat experience and I do not know what's the best way to handle this.
How do you guys arrange your earnings in a tax free country? Have you had any issues when you've moved some money to the UK? Should I set up something in the UK prior to my arrival to KSA?
I am sorry to trouble you all but your experience is priceless, so any advise on this matter would be greatly appreciated...
thanks
Dulge
I am offered a sub-contractor IT Consultancy Role in KSA as British expat. However, I am not sure how to handle my finances in a tax-free country.
The company is happy to EFT my salary account of my choice in anywhere in the world, so I do not get taxed on this but what happens once I move this money back to my main account in the UK.
I have no expat experience and I do not know what's the best way to handle this.
How do you guys arrange your earnings in a tax free country? Have you had any issues when you've moved some money to the UK? Should I set up something in the UK prior to my arrival to KSA?
I am sorry to trouble you all but your experience is priceless, so any advise on this matter would be greatly appreciated...
thanks
Dulge
Jun 2nd 2009, 5:54 am
#2
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Joined: Feb 2007
Location: Over there ----->
Posts: 13,713
Re: Taxing Question / How to handle Finances in a Tax Free Country- Saudi Arabia
Ther have been numerous threads on this and I have posted about it many times. FYI - the situation in the UAE is the same as KSA. (Search threads about tax.)
Just because you decide to work overseas, in a tax-free country, does not mean that you are automatically exempt from UK income tax. You need to start by completing HMRC form P85 - to request non-resident status. Whether you are liable for tax in the currrent year depends on two factors. Firstly when you leave the UK and secondly how long you remain abroad. If you spend more than 90 days in the UK in the current tax year you will be liable for income tax on all your earnings no matter where they arise. The only exception is if you them remain in a tax-free country for 5 (tax) years at which point the split year rules apply.
You may transfer income to the Uk with no tax liability provided you are non-resident for tax purposes as stated above. You may need to prove that this is income and not capital, as CGT is payable unless you have been non-resident for over 5 years.
Transferring monies to the UK is frequently not the best course of action and you should have offshore accounts, as well as a local one.
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Just because you decide to work overseas, in a tax-free country, does not mean that you are automatically exempt from UK income tax. You need to start by completing HMRC form P85 - to request non-resident status. Whether you are liable for tax in the currrent year depends on two factors. Firstly when you leave the UK and secondly how long you remain abroad. If you spend more than 90 days in the UK in the current tax year you will be liable for income tax on all your earnings no matter where they arise. The only exception is if you them remain in a tax-free country for 5 (tax) years at which point the split year rules apply.
You may transfer income to the Uk with no tax liability provided you are non-resident for tax purposes as stated above. You may need to prove that this is income and not capital, as CGT is payable unless you have been non-resident for over 5 years.
Transferring monies to the UK is frequently not the best course of action and you should have offshore accounts, as well as a local one.
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