ExPat UK Income Tax investigation.

[croc]

I am an ex-pat - Since leaving the UK in 2003, I have never received notice to complete a tax return (having moved several times and not informing the Revenue). I receive a small amount of income from a UK property and made a capital gain on a UK investment property several years ago. I would like to do the right thing and fill in a tax return but not if it means raking up past tax liabilities (in particular the capital gain) .

Does anyone know:
1. whether HMR&C would tend to move forward or investigate the past (can of worms I am sorry to say) if I make contact with them? and
2. how long does HMR&C keep records?

Any comments will be gratefully received.

[peterpop]

I spent 11 yrs working overseas in a non tax country and then returned to the Uk. HMRC took me right back to the start and I had to sign that all the information was correct. It was quite an inquisition and although I had nothing to hide and had done everything correctly , including using a tax advisor, I was treated like a potential criminal. Not a pleasant experience. Beware.

[wamstax]

You need to engage on a fee basis with someone who can minimise your liabilities. The fact that you left in 2003 (and assuming that you cut your ties with UK apart from rental) and if you have been absent for 5 (Five) complete tax years your bill might not be as high as you think it could be. If you are a UK national then you would also be able to have a small UK income in any year without tax liabilities arising. This would be especially true if the if the investment property was at any time your only or main residence.

You need to provide all your personal and financial details and dates in and out of the UK in all tax years since you left and get somebody to look at matters for you.

Yes HMRC can be intrusive but again a tax investigation specialist should be able to buffer you with HMRC and if it is a local office that you end up dealing with you woulodn't need to have a meetign to resolve matters anyway

[graham174]

post removed by Webmaster = blatant advertising

[croc]

THANKS for your help on this, its invaluable and I am beginning to see what needs to be done.

[wamstax]

Remember and ask specialists to give examples of their achievements in the past for your particular circumstances and the initial chat should cover the potential (realism should aslo be looked for) for resolving your problem.

[croc]

Thanks again for all this useful info - it's a real help. I Guess I really want to know, if I put in a tax return (I am Australian resident) will the Revenue investigate my past transgressions????

[wamstax]

Hi there again,
The problem is that being a non-resident you would fall under the Non-resident Landlord rules which would be dealt with by the NRL Specialist unit (Centre for Non-Residents or CNR for short) and they have a habit of trying to establish past history of new entrants to the club. Equally if you are receiving rents directly from a tenant in excess of £100 per week your tenant should be deducting tax at basic rate from the rents unless you have received clearance from HMRC to receive the rents gross. This clearance would only be given if you had brought your tax affairs up to date. Mind you if you were a UK national you would still be able to set off your normal personal allowances against your UK income if you were to file a return.

The capital gains potential problem might not be a problem if you were not resident in the UK when you disposed of the property and did not return to the UK within 5 complete tax years (i.e. from 6th April one year to 5th April next year - both inclusive).

For the NRL scheme see the following link http://www.hmrc.gov.uk/cnr/nr_landlords.htm

and for residence issues see the following link http://www.hmrc.gov.uk/cnr/hmrc6.pdf

Thanks for your question