Reply to: Non-domicile

[meridian]

OK, perhaps they only abolished it for Brits :-(

tim

Sort of - any non-domicile in Ireland is required to account for income derived in the UK as well as Ireland.

Not too sure how this works for Brits in Ireland that derive income from outside the UK/Ire though. Given that it's possible to be a Brit but only have an Irish passport (i.e. from Norn Iron) there's bound to be some sort of cross-border rules.

[tim123]

Errm, you'd better tell the Irish revenue that then. According to http://www.revenue.ie/index.htm?/revguide/incometax.htm, "An individual who is domiciled abroad but who is resident in the State is taxed only on so much of his/her income which arises outside Ireland and the United Kingdom as is remitted to the State."

OK, perhaps they only abolished it for Brits :-(

tim

[meridian]

Ireland abolished their non dom rule about three years ago.

tim

Errm, you'd better tell the Irish revenue that then. According to http://www.revenue.ie/index.htm?/revguide/incometax.htm, "An individual who is domiciled abroad but who is resident in the State is taxed only on so much of his/her income which arises outside Ireland and the United Kingdom as is remitted to the State."

[tim123]

Or Ireland...

Ireland abolished their non dom rule about three years ago.

tim

[beermeister]

I'm non dom (born overseas and so are my parents) and briefly looked into offshore companies, but I reckon you need to be on mega bucks to make it worthwhile, not a measley hourly rate.

You normally acquire domicile from your father, oddly enough. You can choose a domicile, but as you can imagine, it's not as easy as filling in a form.

If you're serious about it, do some research on google.

[mace]

I confess

I did look at this as my wife's a foreigner and I figured I could channel some money in to an offshore bank account in her name. I gave up on the idea, however, for the following reasons:-

1. The offshore bank accounts interest rates (at least in Jersey/Guernsey) were lower than the UKs, so the saving wasn't that great.

2. Bank accounts aren't exactly a great place to put excess cash, as they're relatively poor performers.

UK onshore bank account
===================
Gross = 6.5% interest
After 40% tax = 3.9% net
Inflation = 1.9%
Return on Investment = 3.9-1.9 = 2%

Offshore bank account
=================
Gross=5%
Inflation=1.9%
Return on Investment = 3.1%

ISA
===
Gross=8% per year (historical average)
annual management fee=1.5%
Return on Investment=5.5%


Other posters have pointed out that any income made in the UK is taxed. Non-dom status is only for offshore investments in tax havens. If Tories impose a £25k flat tax, I'd imagine non-dom status will be a lot less attractive.

[meridian]

Oddly, this is exactly the option that they would have if they lived permanently in any country other than the UK.

Or Ireland...

[rootsnall]

Anyone who doesn't want to pay the 25K has a simple alternative - declare all of their overseas income in the UK and pay tax on it. Oddly, this is exactly the option that they would have if they lived permanently in any country other than the UK.

Beat me to it ! Stops any salaried types from using the loophole.

It does seem bizarre that the labour party have not closed this loophole ( as promised when in opposition by GB ) and have got away with it.

[tim123]

Yes you can. I'm a non-domiciled British Citizen. They are separate things.

Charging £25K a year doesn't make any sense, you often don't have too much choice about your domicile and £25K would wipe out the average person who happened to have a foreign Dad.

You may not have a choice about your domicile (though the earlier posts suggest that you do), but a person does have a choice to opt to be taxed as a non-dom.

Anyone who doesn't want to pay the 25K has a simple alternative - declare all of their overseas income in the UK and pay tax on it. Oddly, this is exactly the option that they would have if they lived permanently in any country other than the UK.

tim

[max]

As a contractor, setting up and operating with an offshore company may not be possible option ...

Yes...normal agencies only happy with on shore ltd companies(eng/wales for london).

Declaring a non-domicile will help only if you have substantial income in low tax countries.

Low tax: some places don't levy any tax on interest(eg: jersey), others on corporate tax(eg: cayman), or capital gains(eg: NZ).

[sathyaram_s]

Any income earned in the UK is liable to UK tax irrespective of your domicile ...

As a contractor, setting up and operating with an offshore company may not be possible option ...

Declaring a non-domicile will help only if you have substantial income in low tax countries. If you are paying tax in the other country on your assets/income, then you may use the double taxation agreements between UK and the other country to avoid paying tax twice ..

My few cents ..

Has anyone successfully become non-domiciled?

From reading the newspapers it would seem that it's very easy to do. I do have non-UK connections, my wife is born overseas, we own a property there, I was also born in overseas (different country to her).

Work is, and would remain, for a UK client, but could set up an offshore company as needed.

I don't pay that much tax as it is, but see no reason not to reduce it further.

Can anyone recommend lawyers/accountants ?

[meridian]

I though you had to be out of UK for 4 years before you became non-resident.

Different thing. There's tax resident, ordinarily resident, and domicile.

[max]

Yes you can. I'm a non-domiciled British Citizen. They are separate things.

Charging £25K a year doesn't make any sense, you often don't have too much choice about your domicile and £25K would wipe out the average person who happened to have a foreign Dad.

Yes.. it'll be interesting to see how they plan to make actually work.

Hopefully NL don't try to out do them.

[alreadypacked]

I though you had to be out of UK for 4 years before you became non-resident.

[hugebrain]

You just fill out a form available on the inland revenue website promising that you intend to move back to your domicile at some point (could be in a box).
I don't think you can be a British citizen and claim non-dom status, however.

Tories proposal in the unlikely event that they ever get re-elected is that all non-doms will have to pay a flat rate of £25k tax per year to claim that status. That's obviously to prevent an increasing number of oiks benefiting from the tax loophole whilst letting their billionaire mates carry on regardless.

Yes you can. I'm a non-domiciled British Citizen. They are separate things.

Charging £25K a year doesn't make any sense, you often don't have too much choice about your domicile and £25K would wipe out the average person who happened to have a foreign Dad.