mattgowar

Hi,
HMRC allows up to GBP8,000 tax free for moving costs etc for reloacting back to the UK from US

Our container is GBP7500 alone, has anyone been able to claim more than the 8000 without paying tax.

The GBP8000 was the same 3 years ago when we moved out and paid GBP 5000 for the container.

Thanks
Matt

Posidrive

The first thing that you need to be aware of is that as far as I am aware this is not a tax free amount that you can add to your personal allowance, it is the amount that your employer in the UK can contribute towards your relocation costs before it gets taxed as a benefit.

If this is the case then it needs to be discussed with you employer. Some employers will effectively cover the additional tax burden by artificially increasing your salary for the first year.

pennylessinindia

can you show a link for this on the net - or any examples of how this works in practice

Posidrive

The basic ideas of what the UK government will allow is given here:

http://www.hmrc.gov.uk/guidance/relocation.htm

Once you exceed these allowance you will start to pay tax at your marginal rate on the amoount that exceeds them. Take a simple example in which you the £8000 limit applies but your employer pays £10000 in relocation costs and you overall marginal tax rate is 40%. This makes you liable to tax on £2000 of £800. To cover this on a one of basis you employer need to give you a one time extra bonus, or whatever, of £1333 for you not to be out of pocket. The calculation is probably not quite as simple as this but the idea applies.

J.J

Is this an employers relocation package you are considering, or your own move out-of-pocket costs?