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Where Taxpayers and Advisers Meet

query - foreign income

tapanag
Posts:1
Joined:Fri Apr 29, 2016 6:04 am
query - foreign income

Postby tapanag » Fri Apr 29, 2016 6:10 am

Hi,
A person has say 3500 GBP of income in India during the year ( Apr 2015 to April 2016)
This income was NOT remitted to the UK and remains in INDIAN accounts.
This income of 3500 GBP ( approx 3,40,000 INR ) was NOT TAXED IN INDIA as it was below the taxation limits.

The person came to London in Mid April 2015 on a work visa for 2 years.
he is a UK tax payer for tax purposes but his permanent place of domicile / residence is INDIA
and he will return to INDIA after 2 years.

Does this person have to declare the 3500 GBP equivalent of income in india to HMRC and pay tax on that in the UK ?

GlobalTaxAdviser
Posts:633
Joined:Fri Dec 05, 2014 1:18 am

Re: query - foreign income

Postby GlobalTaxAdviser » Fri Apr 29, 2016 11:47 am

Under split year as well as being the start of the new financial year no UK tax payable for past income/gains

However, if he does start earning income or has any gains in India these have to be declared under the arising or remittance basis

Kind Regards

GTA

rbailey28
Posts:47
Joined:Sat Feb 02, 2013 12:35 pm

Re: query - foreign income

Postby rbailey28 » Sat Apr 30, 2016 11:29 am

If a person spends more than 183 days in a tax year in the UK he will be considered resident and has to pay tax on his world income received after the date of arrival whether remitted or not. If he is non UK domiciled, he can opt to pay tax on a remittance basis but would lose his UK personal and CGT allowances. Considering the amount is only £3500 then this would not be worthwhile. If the foreign income is less than £2000 he does not have to declare it.

lsac
Posts:8
Joined:Sat Aug 06, 2016 10:18 pm

Re: query - foreign income

Postby lsac » Wed Sep 14, 2016 3:55 pm

Hi all,
we arrived in the UK last year. I've already read a lot about tax matters on official websites, but I'm still confused. I don't know how long we are going to stay here and we will most probably go back home one day. So my question is, can I choose the remittance basis now and then change to the arising basis in the future?
Thanks

maths
Posts:8507
Joined:Wed Aug 06, 2008 3:25 pm

Re: query - foreign income

Postby maths » Wed Sep 14, 2016 4:49 pm

As a non-UK domiciled individual you can choose remittance basis or arising basis treatment. You can decide for each tax year which of the two bases to choose.

As you are UK resident you should notify HMRC and when completing a Tax Return make the relevant claim.

Whilst technically the 15/16 tax year may qualify for split year treatment, as the arrival was circa April 2015 it's unlikely to be of much practical use.

lsac
Posts:8
Joined:Sat Aug 06, 2016 10:18 pm

Re: query - foreign income

Postby lsac » Wed Sep 14, 2016 10:20 pm

The paragraph 9.15 of the following document explains that you don't need to complete a tax return for less than £2000 unremitted foreign income: https://www.gov.uk/government/uploads/s ... ttance.pdf

" 9.15 If your unremitted foreign income and gains arising or accruing in the tax year are less than £2,000, you can use the remittance basis without having to complete a Self Assessment tax return. In this case you will:
- be automatically taxed on the remittance basis (unless the rules at paragraph 9.11 apply)
- retain your entitlement to UK Personal Tax Allowances and to the annual exempt amount for Capital Gains Tax
- not have to pay the Remittance Basis Charge (RBC) if you are a long- term UK resident "

GlobalTaxAdviser
Posts:633
Joined:Fri Dec 05, 2014 1:18 am

Re: query - foreign income

Postby GlobalTaxAdviser » Fri Sep 16, 2016 1:02 pm

Well yes if your overseas income is less than 2K then you do not have declare the amount.

Kind Regards

GTA


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