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UK Tax Planning For Expats
Moving To The UAE
If you’re moving to the UAE, understanding how your UK tax affairs change is crucial. We guide you through everything from residency status to double-taxation relief, ensuring your move is smooth and tax-efficient.
HOW YOU’RE TAXED IN THE UK
The UK tax system follows a residence based approach meaning that if you are a resident, you will be liable to UK taxation on worldwide incomes & gains whereas if you are non-resident, you will be liable to UK taxation on UK sourced incomes and UK property gains only.
UK SOURCED INCOMES
As a starting point, HMRC can continue to tax UK sourced incomes which include:
from workdays physically exercised in the UK.
from business carried on in the UK.
from schemes established in the UK.
from assets and property situated in the UK.
* Note that British citizens are entitled to the personal allowance (0% tax band) irrespective of their resident status and thus, providing that your UK sourced income is no more than the personal allowance, no tax will be payable to HMRC.
CAPITAL GAINS TAX SUMMARY
HOW TO BECOME NON-RESIDENT
Your resident status is determined by the Statutory Resident Test (‘SRT’). Once your personal circumstances and travel pattern satisfy a test, this will conclude your resident status for the tax year in question.
You’ll be considered non-resident in the UK, if you satisfy either of the following criteria:
if you spend no more than 15/45 midnights in the UK depending on historic resident status.
if you work full time overseas and minimise physical and working presence in the UK.
in you cut connections to the UK and minimise physical presence in the UK.
UK/UAE DOUBLE TAX TREATY
You may receive certain incomes tax free as it is exempt from UK taxation under the DTA and exempt from UAE taxation as income tax and capital gains tax is not levied.
TEMPORARY NON-RESIDENT RULES
The temporary non-resident rules are anti-avoidance legislation designed to catch taxpayers who leave the UK temporarily to receive incomes or dispose of assets, to avoid a tax charge. If you are caught by the temporary non-resident rules, the gains made or income received in the non-resident period, will be subject to tax in the year that you return to the UK and resume UK residency.
Broadly, you will be caught by the temporary non-resident rules if you own assets or generate income while you are resident in the UK, you leave the UK and become non-resident, you sell those assets or withdraw those incomes and return to the UK within a set period of time.
Incomes and assets that can fall within the rules are:
Professionals who move between countries but retain UK employment or sole trade.
TAX OBLIGATIONS IN THE UK
TIPS FOR LEAVING THE UK
ENSURE A SMOOTH TRANSITION OVERSEAS!
Our UK tax services are designed to take full advantage of your non-resident status while you are a British expatriate living in the UAE and to ensure that your obligations are met with HMRC.
Leaving the UK tax guide
Please complete and submit the form to receive a copy of our leaving the UK tax guide.
Click the button below to download our tax guide in PDF format. The guide will download to you computer.
