Full timing abroad and income tax

Nigel&Debbie

Nigel&Debbie

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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
 
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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
 
meor said:
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
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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.
 
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.
 
DevonBeekeeper said:
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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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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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.
 
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callumwa said:
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.
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I would find it hard to have a cake and not eat it.:)
 
callumwa said:
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.
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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.
chockswahay said:
If you own the house jointly then you will be liable on half the income from the house
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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.
 
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.

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Nigel&Debbie said:
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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Hmm......... I would seek confirmation of that........ if you own the house 50/50 then tax liability is 50/50

Be VERY careful :eek:
 
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.
 
Nigel&Debbie said:
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
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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)
 
Haha - it seems me and matamoros were writing the same thing at the same time! Still - tells you something!!!
 
How you are taxed depends on your situation regarding residency and domicile.

Some bedtime reading on the subject here.

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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.
 
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!
 
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peterc10 said:
Bloody hell that is complicated!
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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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Have a look at the Blevins Franks website, I am looking at spending time in Spain in the future and have recently got one of their books about Spain and tax issues etc. they are an international company which gives tax advice for a fee. It's a very complicated subject to say the least. Good luck.
 
gus-lopez said:
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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That particular rule is scandalous, I am still paying income tax, paid NI contributions for 45 years and because I go on long holidays I loose all the NHS entitlements that I have paid for!!:swear2::swear2:

Big brother doesn't seem to have caught up with me yet but how long before passports are scanned at every port of entry and someone joins up the dots.
 
Having moved from UK to Cyprus ( registered to pay tax there, did everything by the book) then moved to France, ( ditto, registered, paid tax there) then moved back to the UK where I am trying to register to pay tax, I'd say stay as you are.
Every time I phone any UK tax/ pension / National Insurance office I get either " I don't know" or get passed from place to place. I've never got a straight answer yet.
You won't be working? As far as I know ( tho it's a q I couldn't get an A to!) you can pay Class 2 contributions via DD.
Keep your vehicle registered / taxed/ insured at a UK address and if you have to pay UK tax, pay it. If you don't have to, then don't.
The flat 20% deduction on rent received ( when property is in UK and you are registered as paying tax abroad) can be changed if you prove you've put the rent received on your foreign tax return.

You might hate full timing abroad, could become ill, circumstances change---keep it simple. For your own sanity.
 
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hello nige........................I recently started to do similar enjoyments. I dont think theres much to worry about. You will have to pay (or should pay) a certain amount of tax on the house rental as its a sort of business. But if you are abroad enjoying life what other taxes should you pay? Your income taxes on investments are taken care of etc. Theres nothing else to consider. No job, and taxes on savings are automatic anyway. The only other thing to consider: Have you got the necessary 30 or 35 qualifying years for your full state pension when you are 65? You can check that by applying for the necessary information on HMRC website, but the results are normally sent to a fixed uk address. If you have not got the necessary qualifying years and want the full state pension you either have to pay the annual difference to HMRC or get your backside back here and get a job........happy travels...steve bristol

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I understand that if you rent your house out via an agent and live abroad, the agent is legally obliged to deduct the tax due before giving you the rent and add it to his tax return. You can apply to HMRC for an exemption certificate if you have a record of paying your tax or show you are declaring the3 income in another country. The agent will need the exemption certificate to cover him if he doesn't deduct tax.

PS Most immigrants DO pay tax in this country!

Regards

Alan
 
gus-lopez said:
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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Most people overlook this one.
 
Well it's not necessary to scan your passport at every border is it? Only when you leave or re-enter the UK - which is done at Dover and Calais on an ordinary ferry crossing or at the airport here and when returning.

If you'd come back within the period revealed by the scan, that would also show on it !

That's why GPs should not under any circs, let you have scrips for more than 3 months supply of any such drug. Main prob with that is, their months only last 28 days ...... and some of em do let you have more, but there's less and less of that kind of GP as time goes on. I haven't got one of the latter sort.
 

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