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Where Taxpayers and Advisers Meet

Move to Netherlands - Tax Liability

boxrick
Posts:7
Joined:Sun Jan 31, 2016 12:03 am
Move to Netherlands - Tax Liability

Postby boxrick » Sat Feb 01, 2020 7:20 pm

I am after a bit of tax advice.

I was born in the UK and hold a British passport. I was a full time employee under PAYE in the UK, and in addition to this did some small scale self employed work 2-5k profit per year and rent out an old house I used to live in.

I have recently moved to The Netherlands and work full time there ( 40 hrs week ) and am taxed at source and continue to rent my house out in the UK ( ~£1000 profit). I also plan to stay PAYE in UK for a small company working remotely doing minor work earning around 10k.

I am looking to do this in the most tax efficient way, and am happy to spend as much ( or little ) time in the UK each year. Ideally I would be taxed the on the respective income of each country but I believe it is more complicated than that.

Does anyone have any advice, links or recommendations?

hendersontax
Posts:33
Joined:Wed Jun 19, 2019 5:04 pm
Location:Manchester
Contact:

Re: Move to Netherlands - Tax Liability

Postby hendersontax » Sat Feb 01, 2020 7:53 pm

If you are non-resident in the UK then you won't be taxable in the UK for income from duties performed in the Netherlands - this includes both your full-time work in the Netherlands and your work carried out remotely for a UK company. If you're being taxed under PAYE on the latter then you should be able to apply for an NT (no tax) tax code so you can be paid the income gross. This means the only income on which you'd be taxable in the UK is your UK rental income, but it sounds like this should be within your UK personal allowance so no tax due (though note that, as a result of the UK's departure from the EU, the law needs updating to ensure British nationals resident overseas continue to be entitled to a personal allowance). You are likely to need to file a UK tax return to declare the rental income (I assume that you have done this in the past).

As a Dutch resident I would expect you to be taxable on all three sources of income there and you should seek advice in the Netherlands to confirm that or whether any relief is available. The rental income would then be taxable in both countries but you won't be eligible for a foreign tax credit if no tax is actually payable on the income in the UK.

Hope that helps but feel free to get in touch if you would like to discuss further.

Thanks.
Tom Henderson ATT(Fellow) CTA
tom@henderson.tax
henderson.tax

ABiLiTieS Trust
Posts:4
Joined:Mon Apr 20, 2020 7:23 pm
Location:Amsterdam
Contact:

Re: Move to Netherlands - Tax Liability

Postby ABiLiTieS Trust » Mon Apr 20, 2020 8:11 pm

If you will qualify as Dutch tax resident you should consider to request a 30% ruling. An employee will then only be taxed on 70% of his income from current employment as 30% is considered as a tax free allowance.

You can find enough information on the web on the 30% ruling. Most important for the 30% ruling is that you shall meet the salary requirement.

In case you have a 30% ruling you can decide if you wish to have foreign income included in your Dutch personal income tax return or not.
ABiLiTieS Trust | Corporate Services Amsterdam
info@abilitiestrust.com
Trust Office Netherlands

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

Re: Move to Netherlands - Tax Liability

Postby maths » Tue Apr 21, 2020 1:57 pm

British subject who are non-UK resident are entitled to a personal allowance under ITA 2007 s 56 as a national of an EEA state (which includes the UK).

Under the UK/Netherlands double tax agreement a resident of the Netherlands also qualifies for a personal allowance so long as the above applies.

In view of the UK's withdrawal from the EU (which is a part of the EEA) any modification of s 56 is likely to still result in British subjects who are simply non-UK resident still qualifying under UK domestic law for a personal allowance. This will not then affect entitlement to a personal allowance under a number of the UK's double tax agreements (including the Netherlands). Note, however, that a non-British subject resident in the Netherlands is not entitled to a personal allowance where the UK income is restricted to interest, dividends and royalties (but rental income excluded).


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