Tax on Uk Dividends - Non Resident

[juggernaut]

Individual Mr. A & Mrs. A are shareholders and directors of a limited company registered in the UK. The main business of the company is to offer consultancy services to banking clients. The most recent accounts filed for the company was for the year ended 31st March 2016 when the company had retained earnings of £16k
Mr. A & Mrs. A have been resident in the UK for over 9 years. They have historically drawn salary and dividend income from the limited company.

Mr. A & Mrs. A plan to relocate by 01 April 2017 to India. Both A & B are expected to receive rental income from their current residence in UK which will be rented out. The income will be less than £2500 per year after expenses.
The Limited company is expected to have retained earnings of £90k by 31st March 2017 (after the directors have drawn dividends of £10k (total) and salary of £8k each)
Question:
a) Dividend tax: If the dividends are withdrawn in Year 2017-2018, would these be exempt from tax in the uk as both Mr. & Mrs. A were non resident? Would these dividends be exempt from tax in India as Mr.A & Mrs.A will be treated as “Not ordinary residents” for upto 2 years.
b) Would it be more tax efficient to withdraw dividends before 31st March 2016?
c) Rental Income: Will tax be deducted at source on rental income in the UK?
I am looking for tax advice (fee basis). Please get in touch if you can help.

[GlobalTaxAdviser]

a) Dividend tax: If the dividends are withdrawn in Year 2017-2018, would these be exempt from tax in the uk as both Mr. & Mrs. A were non resident? Would these dividends be exempt from tax in India as Mr.A & Mrs.A will be treated as “Not ordinary residents” for upto 2 years.

Depends if Mr A and B are non resident in the tax year 2017/18. If resident in India then yes tax will apply and they could get a tax credit in case of double tax.

b) Would it be more tax efficient to withdraw dividends before 31st March 2016?

Again depends on resident status

c) Rental Income: Will tax be deducted at source on rental income in the UK?

Yes but advise to complete NRL1i

Just a couple of other points to bear in mind the company could become resident in India and also there could corporate tax exit charge.