Potential Overseas move

[Gonzo]

Actually, this years letter is about due so I am hoping that one of these days they will tell me not to bother any more.

Bang on schedule, the notice to complete a 2012/2013 Self Assessment tax return has arrived through the post. Threatening me with fines if I don't complete it!

HMRC know when I left in the 2008/2009 tax year..
My 2009/2010 Tax Return showed number of days in the UK=0. Tax due=£0
My 2010/2011 Tax Return showed number of days in the UK=0. Tax due=£0
My 2011/2012 Tax Return showed number of days in the UK=0. Tax due=£0

Not surprisingly, my 2012/2013 Tax Return will show number of days in the UK=0. Tax due=£0

At least they have the decency to include the Residence supplementary pages with the forms they send me these days, rather than making me print them myself.

[Gonzo]

It's a bit of a tricky one because tax regimes differ quite a lot between countries.

My initial reaction is to do a MVL and a capital distribution (what used to be ESC-C16) because it makes a nice clean break. However, it seems that Singapore tax laws don't tax foreign dividend income if it has already been taxed in the country of origin so you may be able to drip feed the salary and dividends out of the company and keep yourself below the UK higher rate tax. However, you also need to be aware that becoming non resident in the UK for tax purposes is not as simple as just leaving the UK you have to completely cut the connection with the UK so having a UK company might leave you liable to pay tax on your worldwide earnings in the UK.

Bottom line - get professional advice on this one.

I agree with (most of) this, if you plan to leave the company open it is essential to know whether or not the country you will move to will be interested in your company and the money you take from it.

If they are not interested then you could drip feed the money out of the company at a rate to stay under the higher rate tax band in the UK and close the company when the cash has been almost exhausted.

I went for the closure option and paid the Capital Gains Tax in the UK. Taking into account the CGT annual allowance and Entrepreneurs' Relief the tax bill did not work out too bad, but that was in the ESC16 days when the closure costs were minimal.

The major consideration for me was that the country I moved do would deem my company to be resident in their jurisdiction the day that I arrived there and they are not as flexible as the UK when it comes to taxation of drawings from a company.

You can inform HMRC that you will become non-resident (Form P85) so that they take no interest in your overseas income once you have left (conditions apply) but they will still want to tax income that originates in the UK. If you stay under the higher-rate band for UK tax purposes that is probably not going to cost you much though because all taxes will already have been paid.
HM Revenue & Customs: Income Tax when leaving the UK

HMRC will accept your P85 but they still require me to complete a SA return including residence pages each year, even after I have spent four complete tax years without spending one single day in the UK or earning a single £ of UK income. Actually, this years letter is about due so I am hoping that one of these days they will tell me not to bother any more.

[Maslins]

guys thanks for the tips so far. i had an initial discussion with my accountant and she suggested i make my Ltd co dormat rather than close. just in case things dont work out and i return within 2 years accountant thinks it will be easier to restart company (instead of setting up new one).
still trying to understand all the rules etc...so complex wish HMRC made life easy for people like me

as i have over money accumumated in the company accounts i need to know what will happen to that...can Ltd co still pay into my UK SIPP while i am away?

Setting up a company is cheap as chips these days, £100 should cover it, and can be done very quickly too. Combining that with the tax benefits of taking funds out on closing and the inherent uncertainty of things like IR35, I'd recommend closing it all up, and if you did come back in a couple of years, so what, start afresh, clean slate.

Re SIPP don't see why not...although what would be the benefit? If there's no profit (as you're working abroad presumably under the equivalent of PAYE) then you'll struggle to get corporation tax relief for the contributions (possibly some scope for carry back).

[diesel]

I agree with the above, you want to make a clean break. The less you have in the UK the clearer the non-residency. There is a form which you can fill out when you leave the UK. As already advised check with an accountant about residency. If you have a family in the UK and you return regularly I think you may well remain resident; if you take them with you, you probably won´t be.

guys thanks for the tips so far. i had an initial discussion with my accountant and she suggested i make my Ltd co dormat rather than close. just in case things dont work out and i return within 2 years accountant thinks it will be easier to restart company (instead of setting up new one).
still trying to understand all the rules etc...so complex wish HMRC made life easy for people like me

as i have over money accumumated in the company accounts i need to know what will happen to that...can Ltd co still pay into my UK SIPP while i am away?

[BlasterBates]

I agree with the above, you want to make a clean break. The less you have in the UK the clearer the non-residency. There is a form which you can fill out when you leave the UK. As already advised check with an accountant about residency. If you have a family in the UK and you return regularly I think you may well remain resident; if you take them with you, you probably won´t be.

[Wanderer]

client in Singapore has offered me a 2 year staff post.

If i accept i could move by August/September time. What Uk taxes will i am be liable for in UK until that time?

is it best to wind up company or make it dormant? I have a bit of cash accumulated in the Company accounts...so what happens to that?

It's a bit of a tricky one because tax regimes differ quite a lot between countries.

My initial reaction is to do a MVL and a capital distribution (what used to be ESC-C16) because it makes a nice clean break. However, it seems that Singapore tax laws don't tax foreign dividend income if it has already been taxed in the country of origin so you may be able to drip feed the salary and dividends out of the company and keep yourself below the UK higher rate tax. However, you also need to be aware that becoming non resident in the UK for tax purposes is not as simple as just leaving the UK you have to completely cut the connection with the UK so having a UK company might leave you liable to pay tax on your worldwide earnings in the UK.

Bottom line - get professional advice on this one.

[diesel]

bump for any advice on looking after company matters??

[diesel]

Currently UK based with my own Ltd Co. (vat reg)

Client has an overseas office in Singapore, and client in Singapore has offered me a 2 year staff post.

If i accept i could move by August/September time. What Uk taxes will i am be liable for in UK until that time?

is it best to wind up company or make it dormant? I have a bit of cash accumulated in the Company accounts...so what happens to that?

any advice welcome please on considering an overseas move.
thanks