Hello
I am new to this forum and have a few questions regarding Indians living in the UK and double taxation arrangement between India and UK.
Situation -
Person born in India and is currently an Indian passport holder living in UK for more than 7 years and holding Indefinite Leave to Remain in the UK.
The person has NRE bank account in India and also a property (on loan) which is rented out.
None of the income generated in India is repatriated to the UK.
Q1 - If the person inherits some residential property or agricultural property in India,
a. Will she be liable for any tax (such as Inheritance tax) in the UK? My understanding is that since the estate is in India, HMRC does not have jurisdiction to charge IHT on this.
b. Will she be liable for CGT in the UK, if she eventually sells either residential property and/or agricultural land?
Q2. As interest earned under NREs account is exempted from Income tax in India, due to Double Taxation arrangement, does she have to declare and/or pay tax on the interest earned in this account?
Q3. If she inherits a residential property and subsequently put it on rent, will she have to declare and/or pay tax on the rental income generated in India? She will be filing Income Tax return in India and pay any tax due in India (after making deductions per Indian tax laws).
Q4. If she purchases a residential property in India and subsequently put it on rent, will she have to declare and/or pay tax on the rental income generated in India? She will be filing Income Tax return in India and pay any tax due in India (after making deductions per Indian tax laws).
Q5. Does her domicile change in the UK, if she purchases a house in the UK (on mortgage)? How does the domicile have an impact on her tax treatment?
Q6. At what income threshold does she have to declare to HMRC about the Indian assets (such as property) or NRE bank accounts in India?
Apologies if any of the question(s) is outside the scope of this forum.
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