non dom tax on remit source ceased money

[gwm121]

resident here dom abroad. Have capital producing interest over the years abroad, and every few years source ceased. Last source ceasing 06/07 and 07/08, and money remitted to uk mid april 08 .

Source ceasing 06/07, so money was capital on 6 april 07. Has this been overturned?
Source ceasing 07/08 so money should have been capital 6 april 08, i asume this has been overturned
Money remitted mid april 08,

I assume the tax due is on the income received 07/08 and the few days in april 08 and no mention is made of it on the last return, and the tax paid on the next return.

[JSK TAXATION]

gwm121

The critical point in this question is that it matters not when the income arose but rather when it was remitted.

If the money was remitted in Mid April, then if it represents pure income, all of the remittance will be taxable in 2008/09.

Where the money represents mixed funds then the order of treatment will be firstly income, then capital gains then tax free capital.

There are still ways that offshore income can be remitted to the UK. If this is relevant for you and you would like to discuss further, please let me know.

Kindest regards.

John S King
Chartered Tax Adviser
www.taxation-advice.com

[maths]

Any monies acquired prior to acquiring UK residency constitutes "capital" and can be remitted UK tax free assuming this can be proved.

Income arising after acquiring UK residency if remitted is in principle taxable.

However, pre 6th April 2008 certain (not all)such income could be remitted tax free if in the tax year of remittance the source had ceased.

The "new" source cessation rules are effective 6th April 2008 and the source cessation option has been stopped. Thus, any income remitted to the UK on or after 6th April 2008 from a source which has already ceased (even if cessation occurred pre 6th April 2008) will be taxable.