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Assisting Businesses Moving to the UK – UK Resident Directors and Bank Accounts

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UK Resident Directors and Opening Bank Accounts

We, at Dixcart in the UK, are asked several times a week if we provide UK resident directors, in order that a UK company owned and sometimes controlled from overseas, can open a UK bank account.

The position is not so simple. Before a UK bank will open a bank account for a UK company that is owned from abroad, there are many compliance and commercial hoops to jump through. Appointing UK resident directors will not magic these away.

Bank Accounts

Banks will not be willing to open accounts where they do not see the opportunity to make a profit. If the proposed account will receive a dividend once or twice a year which is then paid on, leaving only enough to pay the costs of the company, the banks will conclude that the compliance cost of opening such an account will far exceed the money that can be made by providing that banking service. It is just common sense.

Incorporation of a UK Company Run from Outside the UK

Many overseas companies who want to ‘dip their toe’ into the UK market will often want to incorporate a UK company but run it from outside of the UK. They then find it difficult or impossible to open a UK bank account with the end result that we receive several requests every week to act as a director of a UK company owned from outside of the UK. 

UK Director Responsibilities and Associated Fees

Many might think that a professional at Dixcart would be willing to be named as a UK resident director, sign a bank application, and then occasionally sign things as and when requested. 

In reality, if you are a director, you have onerous responsibilities and really need to understand the business, take the key decisions for that business, and ensure that you manage and control that business. 

Clearly one would take the advice of clients, but at the end of the day the ‘buck stops’ with the director. That is why the cost of this service normal carries a risk fee of £5,000 per annum plus a charge for the director’s time costs. In addition, Dixcart would only be willing to accept the position if Dixcart UK did all of the; accounting, company secretarial and tax compliance services for the company. For a relatively quiet holding company the total annual cost is likely to be a minimum £20,000 per annum plus VAT at 20%.  For a trading company the cost is likely to be greater.

The First Year of Operation

In the first year the costs would be higher because you would also have set up fees including; company formation, VAT registration, ICO registration and dealing with commercial contracts and shareholders agreements. The time spent dealing with the potential bank is also likely to be significant, without the guarantee of successfully opening an account.

What are the Banks Looking For?

The banks will typically want to see a business plan that clearly sets out the business opportunity and has budgets and cash flows. They will expect to know who the likely customers and suppliers will be and the size and frequency of deals. They often want to meet the people behind the business and understand how their business is to be done and be confident that there are sufficient human resources to run the business from the UK. Clients are more likely to be successful if they try and open the account with a UK correspondent of the home country bankers.

There are some industries and geographic locations that most banks just will not do business with. Any structure that looks like its prime purpose is tax planning, they will not be keen on either.

Tax Residency Needs to be Considered

The question of tax can be problematic, where the company is in effect being run from outside the UK, as it is likely to mean that, even if you have UK resident directors, the company may be tax resident in the jurisdiction of the individuals managing the day-to-day activity of the company. 

UK companies are tax resident in the UK by virtue of the place of their incorporation. The exception to the rule is where a double tax treaty deems them to be resident in another country. This would typically happen where there is a tie breaker clause in the double tax treaty with the UK, and management and control are not in the UK.

Re-domiciliation of Companies to the UK

The UK is keen to attract genuine businesses to the UK.  As well as attracting new businesses the UK is interested in attracting existing businesses to move to the UK. The UK has recently carried out consultation on the introduction of legislation to permit the re-domiciliation of foreign companies into the UK.

Normally when an overseas business wants to set up in the UK, they will want to send people from their own organisation to get things going. There are various visas that can be applied for, and the UK company will need to apply for a sponsor licence. Our Dixcart immigration lawyers can assist with advice regarding visas and guide you through the application process.

What can Dixcart do to Help?

For genuine businesses, with a well thought out business proposal Dixcart can definitely be of help. 

We are a team of Accountants, Lawyers, Taxation, and Immigration advisors who work together to assist new businesses successfully establish themselves in UK. We also operate a business centre with high quality fully furnished offices of varying sizes.

If you wish to discuss setting up a business in the UK, please contact Laurence Binge at the Dixcart office in the UK: advice.uk@dixcart.com.


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The data contained within this document is for general information only. No responsibility can be accepted for inaccuracies. Readers are also advised that the law and practice may change from time to time. This document is provided for information purposes only and does not constitute accounting, legal or tax advice. Professional advice should be obtained before taking or refraining from any action as a result of the contents of this document.


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The UK – A Truly Excellent Holding Company Location

UK as a holding company Tax

Background – What the UK Offers as a Tax Efficient Jurisdiction

The UK is one of the world’s leading financial countries given its financial services industry and its robust corporate law and governance frame works. This information concentrates on its highly competitive corporation tax system for holding companies.

One of the UK Government’s key ambitions has been to create the most competitive tax system in the G20. It has developed strategies to support, rather than hinder, growth and to boost investment.

Through the implementation of these strategies the Government is aiming to make the UK the most attractive location for corporate headquarters in Europe.

In order to achieve this the UK Government has created an environment where:

  • There are low corporate taxes
  • Most dividend income is tax exempt
  • Most share disposals are tax exempt
  • There is a very good double tax treaty network to minimise withholding taxes on dividends, interest and royalties received by a UK company
  • There is no withholding tax on the distribution of dividends
  • Withholding tax on interest can be reduced due to the UK’s double tax agreements
  • There is no tax on profits arising from the sale of shares in a holding company by non-resident shareholders
  • No capital duty is applicable on the issue of share capital
  • There is no minimum share capital
  • An election is available to exempt overseas branches from UK taxation
  • Informal tax clearances are available
  • Controlled Foreign Company Legislation only applies to narrowly targeted profits

Tax Advantages in More Detail

  • Corporation Tax Rate

Since 1 April 2017 the UK corporation tax rate has been 19% but will increase to 25% with effect from 10th April 2023.

The 19% rate will continue to apply to companies with profits of no more than £50,000 with marginal relief for profits up to £250,000.

  • Tax Exemption for Foreign Income Dividends

Small Companies

Small companies are companies with less than 50 employees that meet one or both of the financial criteria below:

  • Turnover less than €10 million
  • Balance sheet total of less than €10 million

Small companies receive a full exemption from the taxation of foreign income dividends if these are received from a territory that has a double taxation agreement with the UK which contains a non-discrimination article.

Medium and Large Companies

A full exemption from taxation of foreign dividends will apply if the dividend falls into one of several classes of exempt dividend. The most relevant classes are:

  • Dividends paid by a company that is controlled by the UK recipient company
  • Dividends paid in respect of ordinary share capital that is non-redeemable
  • Most portfolio dividends
  • Dividends derived from transactions not designed to reduce UK tax

Where these exemption classifications do not apply, foreign dividends received by a UK company will be subject to UK corporation tax. However, relief will be given for foreign taxation, including underlying taxation, where the UK company controls at least 10% of the voting power of the overseas company.

  • Capital Gains Tax Exemption

There is no capital gains tax on disposals of a trading company, by a member of a trading group, where the disposal is all or part of a substantial shareholding in a trading company or where the disposal is of the holding company of a trading group or sub-group.

To have a substantial shareholding a company must have owned at least 10% of the ordinary shares in the company and have held these shares for a continuous period of twelve months during the two years before disposal. The company must also have an entitlement to at least 10% of the assets on winding up.

A trading company or trading group is a company or group with activities that do not include ‘to a substantial extent’ activities other than trading activities.

Generally, if the non-trading turnover (assets, expenses and management time) of a company or a group does not exceed 20% of the total, it will be considered to be a trading company or group.

  • Tax Treaty Network

The UK has the largest network of double tax treaties in the world.  In most situations, where a UK company owns more than 10% of the issued share capital of an overseas subsidiary, the rate of withholding tax is reduced to 5%.

  • Interest

Interest is generally a tax deductible expense for a UK company providing loans for commercial purposes. There are, of course, transfer pricing and thin capitalisation rules.

Whilst there is a 20% withholding tax on interest, this can be reduced or eliminated by the UK’s double tax agreements.

  • No Withholding Tax

The UK does not impose withholding tax on the distribution of dividends to shareholders or parent companies, regardless of where the shareholder is resident in the world.

  • Sale of Shares in the Holding Company

The UK does not charge capital gains tax on the sale of assets situated in the UK (other than UK residential property) held by non-residents of the UK. 

Since April 2016 UK residents have paid capital gains tax on share disposals at a rate of 10% or 20%, depending on whether they are basic or higher rate taxpayers.

  • Capital Duty

In the UK there is no capital duty on paid up or issued share capital. Stamp duty at 0.5% is, however, payable on subsequent transfers.

  • No Minimum Paid up Share Capital

There is no minimum paid up share capital for normal limited companies in the UK.

In the event that a client wishes to use a public company, the minimum issued share capital is £50,000, of which 25% must be paid up.  Public companies are generally only used for substantial activities.

  • Overseas Branches

A company may elect to exempt from UK corporation tax all of the profits of its overseas branches that are involved in active operating business.  If this election is made, branch losses may not be offset against UK profits.

  • Controlled Foreign Company Rules

Controlled Foreign Company Rules (CFC) are intended to apply only where profits have been artificially diverted from the UK.

Subsidiaries in jurisdictions detailed on a wide list of excluded territories are generally exempt from CFC taxation if less than 10% of the income generated in that territory is exempt from or benefits from a notional interest deduction.

Profit, other than interest income, in all remaining companies is only subject to a CFC charge if a majority of the business functions relating to assets used or risks borne are performed in the UK; even then only if taxed at an effective rate less than 75% of the UK rate.

Interest income, if taxed at less than 75% of the UK rate, is subject to a CFC taxation charge, but only if it arises ultimately from capital invested from the UK or if the funds are managed from the UK.

An election can be made to exempt from CFC taxation 75% of the interest received from lending to direct or indirect non-UK subsidiaries of the UK parent.

Introduction of a New UK Tax – Directed Towards Large Multinational Companies

On April 2015 the UK introduced a new Diverted Profits Tax (DPT) which has also been called the “Google Tax.” It is aimed at countering aggressive tax avoidance by multinational companies, which historically has eroded the UK tax base.

Where applicable, DPT is charged at 25% (compared to the corporation tax rate of 20%) on all profits diverted from the UK.  It is important to note that this is a new tax and is entirely separate from corporation tax or income tax and, as such, losses cannot be set against the DPT.

Conclusion

The UK continues to be regarded as a leading holding company jurisdiction. Due to the number of tax benefits that are legitimately available, its access to capital markets, its robust corporate law and governance frame works.

The recently introduced Diverted Profits Tax is directed towards a specific and limited group of large multinational organisations.

Which UK Services can Dixcart Provide?

Dixcart can provide a comprehensive range of services relating to the formation and management of UK companies. These include:

  • Formation of holding companies
  • Registered office facilities
  • Tax compliance services
  • Accountancy services
  • Director services
  • Dealing with all aspects of acquisitions and disposals

Contact

If you would like further information on this subject, please contact Laurence Binge or Paul Webb: hello@dixcartuk.com, or your usual Dixcart contact.


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The data contained within this document is for general information only. No responsibility can be accepted for inaccuracies. Readers are also advised that the law and practice may change from time to time. This document is provided for information purposes only and does not constitute accounting, legal or tax advice. Professional advice should be obtained before taking or refraining from any action as a result of the contents of this document.


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Don’t Forget the Boring Stuff When Starting a Business!

International Services

Whether you are an overseas business looking to expand into the UK, or already in the UK with an exciting new business planned, your time is valuable. Getting the compliance and administrative elements setup at an early stage is crucial to allow the business to grow efficiently but can be a drain in terms of the time required.

At the Dixcart office in the UK, our combined team of accountants, lawyers, tax advisers and immigration consultants make this process as easy as possible for you – meaning you do not have to have the same conversation twice.

Bespoke Advice

As every business is different, there will always be some specific items to consider for your particular business and taking bespoke professional advice at an early stage will always be the right thing to do.

Please see below a checklist regarding the key compliance matters that every new UK business looking to take on employees needs to consider.

Starting a Business Checklist

  • Immigration: Unless you are looking to only employ workers already with the right to work in the UK, you may need to consider business related visas, such as a sponsor license or sole representative visa.
  • Employment contracts: all employees will need to have an employment contract compliant with UK employment laws. Many businesses will also need to prepare staff handbooks and other policies.
  • Payroll: UK income tax rules, benefits-in-kind, pension auto-enrolment, employer’s liability insurance, all need to be understood and implemented correctly. Administering a UK compliant payroll can be complex.
  • Book-keeping, management reporting, statutory accounting, and audits: well- maintained accounting records will help provide information for considered decision-making and financing and remaining compliant with Companies House and HMRC.
  • VAT: registering for VAT and filing, in compliance with requirements, will help ensure there will be no unexpected surprises and, if dealt with promptly, can help with early-stage cash-flow.
  • Commercial contracts: whether an agreement with a; vendor, supplier, service provider or customer, a well prepared and robust contract will help protect your business and ensure it is well placed for any future exit strategy.
  • Premises: whilst many businesses are operating more and more online, many will still require office or warehousing space. Whether renting or purchasing space we can assist. We also have a Dixcart Business Centre in the UK, which may be helpful if a serviced office is needed, with professional accounting and legal services being available, in the same building.

Conclusion

Failing to take the right advice at the right time when starting a business can prove costly in terms of time and finance at a later stage. By working as one professional team, the information Dixcart UK ascertain from one service we provide can be shared appropriately with other members of the team, so you do not have to have the same conversation twice! We can help!


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The data contained within this document is for general information only. No responsibility can be accepted for inaccuracies. Readers are also advised that the law and practice may change from time to time. This document is provided for information purposes only and does not constitute accounting, legal or tax advice. Professional advice should be obtained before taking or refraining from any action as a result of the contents of this document.


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UK Remittance Basis of Taxation – Don’t Get It Wrong!

Accountancy Tax

Background

UK tax resident, non-domiciled, individuals who are claiming the remittance basis of taxation, do not pay UK tax on foreign income and gains, as long as these are not remitted to the UK.

It is, however, crucial to ensure that this tax benefit is properly planned for and claimed. For more information regarding formally claiming the remittance basis, please see article UK Remittance Basis – It Needs to be Formally Claimed.

Failure to plan properly, before arriving in the UK and becoming UK tax resident, could mean that the benefits available are lost and an unwelcome letter from HM Revenue & Customs (HMRC) might be received.

Case Study

To clearly highlight the risks of not taking the right advice, at the right time, please see a case study below regarding an individual moving to the UK.

  • 1 March 2021 (Day 1)

Mr and Mrs Non-dom decide to leave their current home in Australia and move to the UK during the summer of 2021, so that their two minor children can start school early in September 2021. 

They speak to their Australian tax adviser and make sure that they carry out local tax planning in preparation for leaving Australia.  They have been told by a friend, who had already moved the previous year, that “as they are not originally from the UK, they will be taxed on the ‘remittance basis’, and therefore their non-UK source income will not be taxed in the UK”.

They are pleased as they believe this means:

Assumed: NONE of the following would be taxed in the UK:
income from the rental property they have in Australia; and
dividends (from their large share portfolio) held in a Hong Kong bank; and
interest on the equivalent of £2million cash savings, currently sitting on long term deposit (until the summer of 2022), at the same Hong Kong bank as above.

At this point, they do not seek any UK tax advice. 

What a shame! 

  • 10 August 2021 (Day 2)

Having arranged the correct visas, they move to the UK ready for the new school term. 

They had £50,000 of cash in an Australian current account, that they now remit to their new UK bank account.  They use this for rent and living expenses.

  • 10 August 2022

Having lived in the UK for a year, and with the children now well settled in school, they decide that they will be staying in the UK until such time as both children have completed their education.  They therefore decide to purchase a house.

Since Day 2, they have continued to receive rental income from their Australian rental property, as well as from the family home that they left behind. This income has been paid into an Australian bank account.

The dividend income has carried on being received into the Hong Kong bank account. The long-term deposit of £2million, plus accrued interest, has expired and this income is now earning very little interest in the Hong Kong current account.  They therefore decide to put these monies back on deposit for a further three years.

  • They need £1million to buy the new home in the UK, along with a further £250,000 for stamp duty, renovation costs and school fees.

They therefore sell the rental property in Australia.  The sale proceeds of £1.1million (which includes £100,000 capital gain), are placed in the same Australian bank account as the rental income.  Their dividend income, held in the Hong Kong bank account total £150,000.  They decide to remit the money in both of these accounts to the UK, in order to purchase the property.

  • 10 April 2023

Mr and Mrs Non-dom awake one morning to find a brown envelope, sitting ominously on their doorstep, from the UK tax authority, HMRC.

That afternoon, they visit a local chartered accountant who has the rather difficult task of informing the couple that they owe £28,000 of UK capital gains tax and more than £300,000 in income tax.  This could partially be reduced by double tax relief, but there would still be a substantial unnecessary tax liability. On top of this, they were late filing their UK tax returns for the tax year 2021/2022 and have therefore also incurred fines and penalties.

Turn Back Time: The Potential Positive Effects of Good Planning

The above unfortunate chain of events started on Day 1, in March 2021.

The outcome could have been so different and could have resulted in a UK tax liability of ZERO.

When Mr and Mrs Non-dom heard about the ‘remittance basis’ from a friend and looked up some articles online, they should have taken advice from a UK adviser, as well as taking advice from their Australian tax advisor.

The UK tax advisor would have told them:

they would become tax resident in the UK from 6 April 2021 (having moved to the UK on 10 August 2021), and would therefore have been liable to file a tax return by 31 January 2023 and pay any taxes due; and
on Day 1, they should have instructed their Australian bank to pay new rental income into a new bank account (with the same bank); and
on Day 1, they should have instructed the Hong Kong bank to keep dividend income and interest from that cash deposit, in new separate accounts; and
when they sold the Australian rental property, they should not have remitted this income to the UK.

Instead, they should have remitted £1,250,000 of the £2million, from their original cash savings, to purchase their new home in the UK and to cover the stamp duty, renovation costs and school fees. 

  • Had they taken the final step detailed above, they would have retained the same value of investments in Australia and Hong Kong as if they had not taken the UK advice. 
  • However, they would have remitted capital that they had PRIOR to becoming UK tax resident, which would NOT therefore have been taxable.

The steps recommended above, are not complicated, and many international banks are capable of implementing this account segregation for their UK resident clients.

Summary and Additional Information

The remittance basis of taxation, which is available for non-UK domiciled individuals, can be a very attractive and tax efficient position, but it is crucial that it is properly planned for and formally claimed.  Mr and Mrs Non-dom did not take appropriate UK advice and paid the price.

If you require additional information on this topic, further guidance regarding your possible entitlement to use the UK remittance basis of taxation, and how to properly claim it, please contact your usual Dixcart adviser or speak to Paul Webb or Peter Robertson in the UK office: advice.uk@dixcart.com.

Dixcart UK, is a combined accounting, legal, tax and immigration firm.  We are well placed to provide these services to international groups and families with members in the UK. The combined expertise that we provide, from one building, means that we work efficiently and coordinate a variety of professional advisers, which is key for families and businesses with cross-border activities.

By working as one professional team, the information we obtain from providing one service, can be shared appropriately with other members of the team, so that you do not need to have the same conversation twice!  We are ideally placed to assist in situations as detailed in the case study above. We can provide cost effective individual and company administration services and also offer in-house expertise to aid with more complex legal and tax matters.


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The data contained within this document is for general information only. No responsibility can be accepted for inaccuracies. Readers are also advised that the law and practice may change from time to time. This document is provided for information purposes only and does not constitute accounting, legal or tax advice. Professional advice should be obtained before taking or refraining from any action as a result of the contents of this document.


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Forming a UK Company: Professional Director Services

Director services Accountancy

Forming a UK Company

The UK is as an attractive market for many overseas businesses forming a holding company. Special Purpose Vehicles (“SPVs”) are also set up in the UK for joint investments into specific projects, often where investors want to speak with one voice.

The UK is chosen for forming a company because of its low tax environment for non-UK investors and its high reputation for corporate governance, well-developed legal system and its holding company regime.

We help clients with UK domiciliation services and professional director service needs. Our directors are UK resident, professionally qualified accountants and lawyers

As directors, we are mindful that we must manage the companies under our control and ensure they remain legally compliant and solvent. When acting as directors, we have a duty of care to do our best to benefit the company. This involves:

  • Taking advice to determine the company’s strategy and policies.
  • Monitoring ongoing progress of those strategies and policies.
  • Accounting for the company’s activities to relevant parties, including shareholders and authorities.

Appointing a UK Director

Clients typically appoint us because they initially do not have the resources in the UK to provide the management and control of the proposed company in the UK. If management and control were to be exercised from a client’s home jurisdiction there would be a danger that jurisdiction would seek to tax the profits of the UK company. The question therefore is: where is a company managed and controlled, and what factors will tax authorities consider when accessing where management and control rests?

The central management and control of a company would normally be the place where directors meet to manage the company’s business. Generally, this is the place where board meetings are conducted. This is only relevant if central management and control is in fact exercised by the directors in those meetings. It is essential to show that directors have authority and make independent and informed decisions concerning the central business policy of the company and not seen to be ‘rubber stamping’ decisions of others.

As a result, it is important foreign shareholders appoint UK resident directors who are aware of these risks and ensure that they carry out their duties correctly, but also properly minute and evidence their actions in order to be able to demonstrate management and control in the UK, if called upon to do so.

Where a UK entity is being used as an SPV for a number of different shareholders, we are often appointed because the shareholders want independent directors to run the company, who will familiarise themselves with any shareholder agreement, and ensure the controls and mechanisms put in place to govern the relationship between the shareholders and protect minorities, are observed.

Dixcart directors are supported by a team of professionals enabling us to provide a complete business management and administration service. This includes:

Get in touch

Clients wishing to establish a business in the UK are advised to contact us early on so that we can get a comprehensive understanding of the proposed business. This will enable us to give relevant pre-arrival advice and demonstrate how our directors would add value, should you decide to form a company in the UK. Please contact Laurence Binge or Peter Robertson for more information: hello@dixcartuk.com.


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The data contained within this document is for general information only. No responsibility can be accepted for inaccuracies. Readers are also advised that the law and practice may change from time to time. This document is provided for information purposes only and does not constitute accounting, legal or tax advice. Professional advice should be obtained before taking or refraining from any action as a result of the contents of this document.


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UK Statutory Residence Test – Don’t Get It Wrong!

Accountancy

Background

“Don’t worry, I never spend more than 90 days in the UK”.

This test for UK tax residence was replaced with a statutory residence test, but it is still commonly believed that the above statement is correct.

It is not and, whilst in many cases, the test might result in an individual triggering UK tax residency without expecting it, in many other circumstances, they might have been limiting themselves to the wrong number of days.

For anyone renting or buying property in the UK and starting to spend more and more time in the UK, they should seek advice to be clear what their day pattern in the UK should or can be.

This note considers a couple who have not previously been tax resident in the UK.  For more information about correctly losing UK tax residence, please see – https://www.dixcart.com/tax-residence-planning-opportunities-case-studies-and-how-to-get-it-right/ . It also does not consider immigration but more information on how Dixcart can assist with UK Immigration can be found here – https://www.dixcartuk.com/immigration/

Case Study

Mr Overseas has lived in Europe his whole life.  Having sold his successful overseas business a number of years ago, he took early retirement. He is not married.

Having retired, he wants to spend more time in the UK as he has nephews and nieces whom he enjoys seeing more of.

He also feels that the UK real estate market might be a good investment, so he purchases an apartment that he lives in when he is here.  It is empty the rest of the time.

Thinking he is doing some clever tax planning, he chooses to limit his days in the UK to 85-89 days, because everyone tells him that if he stays in the UK for fewer than 90 days, he won’t become tax resident. 

Mr O Should Take Some Advice!

The part of the UK statutory resident test (Test) relevant to him is part 3, the Connecting Factors.  In the first year he starts spending time in the UK, he does not have a tax resident family member, he has not exceeded 90 days in the UK in either of the two previous tax years, and he does not work in the UK for more than 40 days each tax year.  He does have available accommodation though, so he has just one Connecting Factor.  In the first year, he could spend up to 182 days in the UK without becoming UK tax resident, double what he had originally thought.

In the second year, he would still have available accommodation but also now would have spent more than 90 days in one of the previous two tax years.  His day limit is now 120 days, still more than the “90 days rule” he had been told about.

Once he discovers this, he starts spending up to 115-119 days in the UK

However – The Rules Need Constant Review

As Mr O is now spending more time in the UK, he meets someone special and gets married.  He also gets bored of early retirement and starts a consulting role for most of the days he is in the UK.

Thinking that he has now taken his UK tax advice about residence, he doesn’t think to check it again.

Mr O now has a tax resident spouse, he works for more than 40 days in the UK, he has spent more than 90 days in the UK in at least one of the last two previous tax years and he still has available accommodation.

His tax circumstances have changed dramatically and, in fact, if he wants to still remain non-resident in the UK, his day count would be capped at 45 days!

There is still planning to do though as he might be able to claim the remittance basis as a non-domiciled individual, and, like the residence rules, “Don’t Get it Wrong!”  https://www.dixcartuk.com/uk-remittance-basis-of-taxation-dont-get-it-wrong/

Summary and Additional Information

Whilst Mr O’s circumstances shifted during the course of this case study, it is interesting to note that at no point in time was Mr O’s day count cap at 90 days, despite the common belief that those are the rules for UK residence.

The remittance basis of taxation, which is available for non-UK domiciled individuals, can be a very attractive and tax efficient position, but it is crucial that it is properly planned for and properly claimed at the right time. 

If you require additional information on this topic, further guidance regarding your possible entitlement to use the UK remittance basis of taxation, and how to properly claim it, please contact your usual Dixcart adviser in the UK office: advice.uk@dixcart.com.

Dixcart UK, is a combined accounting, legal, tax and immigration firm.  We are well placed to provide these services to international groups and families with members in the UK. The combined expertise that we provide, from one building, means that we work efficiently and coordinate a variety of professional advisers, which is key for families and businesses with cross-border activities.

By working as one professional team, the information we obtain from providing one service, can be shared appropriately with other members of the team, so that you do not need to have the same conversation twice!  We are ideally placed to assist in situations as detailed in the case study above. We can provide cost effective individual and company administration services and also offer in-house expertise to provide assistance with more complex legal and tax matters.


Back

The data contained within this document is for general information only. No responsibility can be accepted for inaccuracies. Readers are also advised that the law and practice may change from time to time. This document is provided for information purposes only and does not constitute accounting, legal or tax advice. Professional advice should be obtained before taking or refraining from any action as a result of the contents of this document.


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