Interest earned on private loan

[dutchie]

I am a Dutch person, and have been living and paying taxes in the UK for approx 8½ years. I am currently self-employed. I am also married to a British woman since August 2003.
A year ago I invested some money with a dutch firm, in what they class as a 'private loan agreement'. How it works is that I lend them money and they pay a fixed percentage of interest over a fixed period of 4 months. After the 4 months you can withdraw the money and interest or leave it with them to earn compound interest. Since the first investment, I have lend them more over the cause of the last year. My questions are:
1. Is the interest taxable?
2. Where is it taxable?
3. When is it taxable?

I would be grateful for any advise on this matter.

[King_Maker]

For UK tax purposes, it will depend on your Domicile and whether you have "remitted" (broadly, brought into the UK) the interest to the UK.

If you are not UK domiciled (not to be confused with residence nor nationality), you are taxable on the basis of remitted income.

I cannot comment on the Dutch taxes, if any.

Seek professional advice - especially if the amounts involved are significant.

Warwick.

[dutchie]

Thank you for your quick reply King_Maker.

Can you please explain the difference between residency, nationality and domiciled? So that I can determine my status before seeking further advice.