Full timing abroad and income tax

Discussion in 'Full Timers' started by Nigel&Debbie, Nov 13, 2014.

  1. Nigel&Debbie

    Nigel&Debbie Read Only Funster

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    Can anyone give any guidance on income tax whilst full timing abroad.


    We will be renting our house out (in wife’s name so not to pay tax on the income - expected not to exceed personal allowance) and for at least 3 years will be full timing in Europe (may well come back to visit family but only f0r short durations.)


    I have a private pension which is taxed at the moment at source. If I am not living in UK, will I still have to pay tax? Although living abroad, due to full timing in van I will not have a permanent address outside the UK.


    For other domestic matters i.e. van tax and insurance etc, we will be using C/o address in the UK (the mother in law.


    Is there anyone in a similar position that can offer some advice?


    Thanks
     
    Last edited: Nov 13, 2014
  2. Mel

    Mel Funster

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    Just out of interest will you have private health insurance?

    If not wont you have to pay tax in the UK to have NHS cover?

    Mel
     
  3. Nigel&Debbie

    Nigel&Debbie Read Only Funster

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    I have private medical insurance. Not wishing to go off subject, but do I really have to pay income tax to qualify for NHS - nearly all the immigrants don't pay tax but they seem to qualify! I have more than enough NI contrbutions etc for all other benefits.
     
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  4. John Laidler

    John Laidler Funster

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    My guess is you can't go "off grid" with regard to tax. If you are living in another country and paying their taxes that is fine but to say you are of no fixed abode and shouldn't pay anyone won't wash I fear.

    You need to speak to an accountant with experience in this area for a better answer.
     
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  5. Bertie Bassett

    Bertie Bassett Read Only Funster

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    What the Beekeeper said and having been there and done that ourselves we would advise you to retain your own address but get an annual Royal Mail divert to your alternative address. Insurers and Bankers like to see continuity of address and aren't keen on c/o in our experience. Medium to long term it also keeps your credit history dazzlingly (Persil) white. (y)
     
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  6. callumwa

    callumwa Read Only Funster

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    Do you generally intend to stay in the EU whilst full timing?

    As I understand it if you are in the EU, then you need to pay tax in an EU country which you can "notionally" nominate.
    I did this for a few years with no issues, but I did pay tax in an EU country and have the records of it, and used a traceable "permanent" home address within the EU.....

    However if still taxing and insuring your van from a UK address, you leave yourself very open as regards to your residency and tax liabilities, if you have no other overseas address in the EU or elsewhere.

    Regarding the rental income on your UK property, if you are no longer a UK resident you must pay a flat 20% non resident tax on all income from your property let. As you are not resident, you have no "allowances" at all.
    When I lived in France I payed a flat 20% on my UK rental incomes.

    Without being rude, seems that you are asking if you can have your cake and eat it.
    I suggest you get professional advice to avoid any unfortunate surprises.
     
    Last edited: Nov 14, 2014
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  7. lesleyjean

    lesleyjean Funster

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    I would find it hard to have a cake and not eat it.:)
     
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  8. Chockswahay

    Chockswahay Funster

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    If you own the house jointly then you will be liable on half the income from the house :eek:
     
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  9. Nigel&Debbie

    Nigel&Debbie Read Only Funster

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    Hence the reason why I am asking for any advice - certainly dont expect to pay nothing re tax, but if there is a way to save a bob or two what is wrong in asking?

    Will be seeking professional advice but it does help to go to the meeting with a bit of an inclin before hand.
    Already had advice on this matter and the tax liability will be wholly the responsibility of the wife using her tax allowance (if she retains domicile status in UK). She will set up her own business as a sole trader, paying NI so the can continue to build up her NI entitlements for future years. This is from the actual tax office.
     
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  10. peterc10

    peterc10 Funster

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    The best advice on here is to get some advice from an expert. I suspect your tax status will depend upon where you are considered to be domiciled, and I suspect that will be the UK, especially if you are going to maintain your bank account in the UK and continue to tax and MOT the motorhome in the UK (which is another thing you are going to have to think about - how are you going to get your yearly MOT?). But all of this is fraught with detailed rules.
     
  11. Chockswahay

    Chockswahay Funster

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    Hmm......... I would seek confirmation of that........ if you own the house 50/50 then tax liability is 50/50

    Be VERY careful :eek:
     
  12. matamoros

    matamoros Funster

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    Ours is a slightly different scenario in that we sold up completely but I am still in partnership with my son, book keeping only,so still fill in self assessment forms and until this year(now 65) paid NI contributions.

    As far as the authorities are concerned we live at my son's address, on the electoral register, that is where I live. I choose to go on extended holidays and return home for a week at Christmas, a week in the spring and a couple of months in the summer. We are never in any one country for more than six months,

    I personally would not get into any discussions with HMRC about your change of circumstances as in my experience this will only complicate matters and you will undoubtedly be given conflicting information.Inform them and everyone else that you are changing address, they do not need to know the reasons and I think that unless you are a multi millionaire trying to avoid taxes they will have better things to occupy their minds.

    I think as long as you are up front with your tax liabilities you should have no problems and in the unlikely event of someone investigating your case you would have a very good argument in the extended holiday scenario.
     
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  13. BreweryDave

    BreweryDave Funster Life Member

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    You will remain a uk resident and everything will remain the same - you will simply be abroad on a long holiday - that's the simplest way to think of it. Although FT in a van - unless you register yourself as a resident in whichever EU country you choose - you will remain a uk resident and all that goes with it. The c/o address shouldn't be a problem if you have the right insurance. I have our vehicle,insurance, log book and driving licence , bank and credit cards all registered at a mailing address - which keeps me a uk resident even though I intend to spend most of my life FT in Europe. We have no 'permanent' address and are not on the electoral role but that's not an issue.
    Don't overthink it - it really is simple to do without really changing anything with regard to residency and complicating tax and entitlement issues - you're just on a 'long holiday' and no need to change anything or even to tell 'big brother' !
    Good luck with it(y)
     
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  14. BreweryDave

    BreweryDave Funster Life Member

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    Haha - it seems me and matamoros were writing the same thing at the same time! Still - tells you something!!!
     
  15. keith

    keith Funster

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    How you are taxed depends on your situation regarding residency and domicile.

    Some bedtime reading on the subject here.
     
  16. Abacist

    Abacist Funster

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    I am a retired chartered accountant and did not advise on tax matters but I know enough not to advise you and get it wrong!

    Just so that you know something there are 2 distinct categories applied to any person which are domicile and residence.

    As things presently stand you and your wife's domicile is the UK for various reasons like being born here, brought up, having a house, lived and worked here and have assets here and probably intend to be cremated or die here. It is quite difficult to shake off your domicile other than by severing completely all ties with the country and emigrating and giving up UK passport etc.

    You can become UK non-resident for tax purposes but the rules are difficult and complex and HMRC are very strict over dates and times of visits back to the UK.
    So if you came back for an unplanned visit for just a day to see an ill relative that could make you both resident for tax purposes.

    Read the HMRC booklet on the Statutory Residence Test to see how complex it is. If it were me I would continue as you are with both being UK tax resident as then you won't have to deal with any other country's tax system with the added language complexity!

    PM me if you want some names of where to get advice.
     
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  17. Abacist

    Abacist Funster

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    You will have to Google - HMRC booklet on the Statutory Residence Test and download a pdf copy if you want. For some reason I can't get a link to it to work.

    If you have income arising in the UK then HMRC will want to try and tax it. e.g. Property income and Pensions, Capital Gains, Inheritance Tax, Earnings from employment etc.

    Don't forget that HMRC gets returns of just about everything not just from you but from employers, pension schemes, land registry, rents collected via agents, banks, etc so beware forgetting to declare anything!
     
    Last edited: Nov 15, 2014
  18. peterc10

    peterc10 Funster

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    Bloody hell that is complicated!
     
  19. Judge Mental

    Judge Mental Funster Deceased RIP

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    Foot Loose & Fancy Free......dont look that easy does it!
     
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  20. gus-lopez

    gus-lopez Funster

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    It is . :LOL:
    The Op at the end of the day as Abacist said would be classed as a Uk domiciled resident,If he has no attachment anywhere else.
    You have to pay somewhere, regardless of the fact that you might live & have nothing anywhere.
    Payment of UK income tax, N.I; , does not entitle you to healthcare or anything else. Only actually being in the UK entitles you to healthcare.
    Payment of income tax , N.I. council tax , owning a house etc; entitles you to nothing.
    Once out of the UK over 90 days , even on an 'extended holiday ' , you have no right to NHS healthcare nor continued use of the EHic. You 're meant to tell them but no one does.
    You are then meant to re-register when you return.
     
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