TAXguide 04/18: Residence and domicile
In TAXguide 04/18 Lisa Spearman provides an introduction to the taxation issues which may be in point when considering the non UK aspects of a client’s affairs. Read a summary here, Tax Faculty members can download the full guide.
In any event, this is an area where specialist knowledge may well be required (see Mehjoo v Barker  EWHC 1500 (QB)). This guide aims to provide an overview and summary of the most commonly encountered points. It is not comprehensive and should be read with this clearly in mind. In particular we do not cover Transfer of Assets Abroad legislation, Annual Taxation of Enveloped Dwellings, capital gains tax (CGT) for non-residents on residential property or matters relating to employment-related securities.
Nor do we address the changes to the IHT treatment of UK residential property for non-domiciliaries, which came into effect from 6 April 2017. Finally, space does not permit any discussion of the taxation of offshore trusts and companies. It is very often the case that non domiciled people have interests in such entities and readers should be certain they are up to date on the taxation rules relating to this matter - further changes have been introduced from 6 April 2017 and 6 April 2018.
If you are required to advise a client outside of your experience, we recommend that you consider enlisting specialist help, for example from TAXconnect.
The full 30-page guide covers:
|3||The statutory residence test||
Automatic overseas tests
Automatic UK tests
Sufficient ties test
Domicile of origin
Domicile of dependency
Domicile of choice
Formerly domicile residents
|5||The remittance basis||
|6||Types of remittance|
|7||Calculating and tracing the amount remitted|
|8||Transitional reliefs||Cleansing :Rebasing|
|9||Overseas workday relief||Special mixed funding rules|
|10||Consequential issues of using the remittance basis||
Bringing an asset to the UK
|11|| Business investment relief
Obtaining a benefit
Potential tax charges
|12|| Capital losses
|13||Record-keeping and compliance|