Income Tax in UK for EU Nationals

[Viktor]

I am an EU National contracting in UK through a limited company.

If I leave UK next year in April/May, after I close the company + pay CT, can I take all money out of the company as divis without paying Income Tax on divis above 35k for year April 2009 - April 2010?

Basically I want to f(*& off to a sunny place for at least 6 months. I am not a UK citizen. Does the 6 month rule apply in this case? During year April 2009 - April 2010 I will be out of UK for at least 6 months.

Thanks in advance for answers,

Victor

[tim123]

I am an EU National contracting in UK through a limited company.

If I leave UK next year in April/May, after I close the company + pay CT, can I take all money out of the company as divis without paying Income Tax on divis above 35k for year April 2009 - April 2010?

Basically I want to f(*& off to a sunny place for at least 6 months. I am not a UK citizen. Does the 6 month rule apply in this case? During year April 2009 - April 2010 I will be out of UK for at least 6 months.

Thanks in advance for answers,

Victor

The answer to this question will depend upon when you first came to the UK and whether you intend to return to the UK after the 6 months "*%$? off".

tim

[Viktor]

I've been in UK since Oct 2005. I am resident for tax purposes in this fiscal year (April 2008 - April 2009)

I want to leave in May 2009 and possibly return in 2010 (if the contract market isn't totally f*&^). In any case I will be out of the country for at least 6 months during fiscal year April 2009 - April 2010.

[tim123]

I've been in UK since Oct 2005. I am resident for tax purposes in this fiscal year (April 2008 - April 2009)

I want to leave in May 2009 and possibly return in 2010 (if the contract market isn't totally f*&^). In any case I will be out of the country for at least 6 months during fiscal year April 2009 - April 2010.

If you are coming back "at least six months" isn't good enough. It needs to be "more than six months".

It also needs to average over a rolling 4 year period at no more than three months in the UK. So no I don't think that taking six months out of the year and then coming back will make you non resident for the year.

tim

[Viktor]

I will be out of UK for more than 6 months. The question is for how long do you need to be out of UK during a fiscal year in order to be considered "not resident" for tax purposes.

I can't believe I am taxed in UK for the whole year if I only stay let's say 3 months...

[expat]

I am an EU National contracting in UK through a limited company.

If I leave UK next year in April/May, after I close the company + pay CT, can I take all money out of the company as divis without paying Income Tax on divis above 35k for year April 2009 - April 2010?

Basically I want to f(*& off to a sunny place for at least 6 months. I am not a UK citizen. Does the 6 month rule apply in this case? During year April 2009 - April 2010 I will be out of UK for at least 6 months.

Thanks in advance for answers,

Victor

I am not able to answer your question (IANAA etc etc) but I can give you one useful hint: it is about your residence, and the type and location of income; citizenship has nothing to do with it.

[Unicorn]

Tax status

In reply to Viktor.

Try downloading the P85 form from the HMRC. You complete this when you leave the UK to reclaim any taxes which may be due to you. It also allows HMRC to assess you for non-residency status.

Read the questions on the form. What you answer to those depends what status you will be granted. It asks things like 'Do you intend to live outside the UK permenantly ?' - sounds like you'll be answering no. 'Are you leaving the UK to work ?' - again sounds like you'll be answering no. 'Will you have any accommodation in the UK while you are away ?' 'Will you return to the property as your main residence within 4 years ?' based on these replies HMRC will decide to allocate non-resident status or reserve the right to assess your status on an on-going basis - i.e. you pay the tax and IF you meet the criteria in the future you get a rebate.

To get the not ordinarily resident status you need to live AND work outside the UK for a full tax year. So if you return to the UK after your 6+ months f*** off in the sun I doubt you will meet Hector's rules to avoid being liable for all earnings in the 2009/10 tax year in the UK.

[tim123]

I will be out of UK for more than 6 months. The question is for how long do you need to be out of UK during a fiscal year in order to be considered "not resident" for tax purposes.

I can't believe I am taxed in UK for the whole year if I only stay let's say 3 months...

You're not only staying in the UK for three months.

You stayed here for 3 and a half years

tim

[Viktor]

To Unicorn and Tim,

Yes I've stayed in UK for more than 3 years now. I am NOT a tax dodger.

But me and the present UK Gov have different views about how things need to be solved/taxed/fixed. I am hugely dissapointed by the tax system in this country and the way Big Gov wants to "fix" problems. I am a SAVER, I am NOT a spender, and savers will get shafted.

Hence my decision to go. I believe that in a free Europe we should have choices. My choice is to be physically resident in another EU country for more than 6 months...depends how things evolve over time with this mess.

I can't say that I will not return to UK...but I don't want to be taxed in fiscal year 2009/2010. I will work elsewhere and get taxed in another EU country.

Do I need to pay tax 2009/2010 for the simple fact that I have lived here 3 years?

[Unicorn]

P85

Viktor,

Not sure where you get the idea I suggested you're a tax dodger

If you leave the UK before April 2009 and complete the P85 form saying you are leaving the UK and leaving for good then you shouldn't be liable for tax in 2009/2010 tax year.

If you return to the UK before April 2010 then that is where you will have problems. You will have returned before the end of tax year and your status then will be assessed by the HMRC, after completing a P86. The P86 asks how many days you spent in the UK in the previous 5 tax years.

That's where my knowledge ends as I don't know what the HMRC do depending on how the question is answered. You may also have issues if you return to the UK in tax year 2010/2011 again it depends on what HMRC do with the information you state on form P86.