Master Class #33-Ways to Mitigate Your Taxes if you own investments & assets in UK

The tax system in UK depends on the individual, whether he is domiciled or non domiciled and also if he is a resident or non resident of UK … A sharing by Jason Collins Head of Tax – Head of Client Relationships, Financial Services

For UK Domiciled residents, the UK residents had to take along all kinds of tax, Income Tax, Capital Gains Tax and Inheritance tax, regardless of UK or non UK origin of the income or gain. For non residence domiciled residence they are still liable to be taxed on money made in UK like property or otherwise there isn’t any tax on money made in UK. They are also exempted from capital gains taxes but they are still liable for inheritance tax for both UK and non UK sources.
Non UK Domiciled individuals, the UK resident essentially are not required to pay for any tax for the worldwide income and only taxed for UK incomes. For non UK domiciled resident, they are liable to be taxed in UK income tax and UK inheritance tax but not capital tax.

Definition of domicile:
Domicile is the jurisdiction one regard as a permanent home. One can only have one domicile and the domicile of ‘origin’ is from the father. Domicile usually remains with one for lives unless one acquires domiciles of choice. It is very difficult to establish such domicile and one has to settle residence in that country and settle ties with the original country.
Not the same as nationality or residence.

Definition of residence:
Residence is more of a short term concept and is based on where you lived in a tax year. The UK had a very complicated system where one can potentially be a UK residence for spending 45 days there (contrast to other country which requires 6 months and one is certain to be a residence) (but the system still provided certainty).

UK Statutory Residence Rules from 2013:
Anyone having a full time work outside UK is a non-UK resident and allowed up to 90 days in the UK and of which 30 days can be ‘work days’ with at least 3 hours working. UK resident who work full time in UK, one is automatically a residence, provided they spent 75% of the working days in UK.

In other cases, it depends on number of days present in UK and the number of ties in UK.
Ties are defined as Dependent family, Accommodation made available for use up to 91 days, having 40+ work days in UK, 91 or more days in either of previous 2 tax years and more days spent in UK than in other country. More Ties are allowed if one is an ‘Arriver’ than a ‘Leaver’ and is easier to obtain UK residency than to lose it.

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