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aerocomp 20th May 2014 13:54

UK Tax question
 
I have just started to work in the UK, but I have my home in another country and will travel home whenever I have the chance.
Because of this I will just rent a flat here, or even maybe checkin at a hotel during the days I will be required at the base.
How will this affect me tax wise, are there any tax reliefs due to my situation that I can use?
Anybody who has been in the same situation who can share some thoughts?

Capetonian 20th May 2014 14:08

There is no simple answer to this.

There is a general rule that if you work for a UK employer from a fixed base in the UK, HMRC have first claim on taxation arising on your income, even if you are fiscally resident elsewhere.

From the little you have said, it sounds as if you would not be considered as working from a fixed UK base, so the above may not apply to you.

Liability will also be determined by where you are fiscally resident, what dual-taxation treaties exist between the UK and that country, how long you spend in the UK and elsewhere, and other factors.

Seek expert advice, as failure to do could be very costly, both because you may pay more in tax than you need to, and also because if you, even unknowingly, fall foul of the regulations, the penalties are severe. You are unlikely to end up in prison but you could find yourself forking out a lot in fine.

haughtney1 21st May 2014 11:43

Its all explained here:ok:

mad_jock 22nd May 2014 14:12

that's only half of it.

Your own tax authority may take a different view.

The familys medical insurance may be completely screwed with as well.

I do know pilots that in the end it just wasn't worth working in the UK unless they took the whole family over.

Ampage 22nd May 2014 16:45

Still have to pay council tax too if you rent a flat I understand

wiggy 23rd May 2014 09:11

As others have said you probably need expert advice (at least initially) and have a look at the link haughtney1 provided.

That said if you're in a flying job it may be possible to reduce your exposure to UK tax, even if you are UK based, provided you spend a significant amount of your duty time outside UK airspace.

BTW this might be of use

http://www.deloitte.com/assets/Dcom-...ickerGrace.pdf

Gertrude the Wombat 2nd June 2014 22:25


how HMRC interprets the legislation
Which is not, in some cases, necessarily how the courts interpret the legislation, which is what actually matters at the end of the day - HMRC have been known to publish outrageous "guidance" (about employment status tax law) which was completely at odds with the evolving case law.

Fox3WheresMyBanana 6th June 2014 12:57

I currently have a request in with HMRC to clarify my situation, as I was in the same position last year.
First, you need to check the dual taxation situation between UK and your home country. That advice is here.
http://www.hmrc.gov.uk/international/dta-intro.htm
Next, Haughtney1's reference is the latest info. It is quite straightforward as they now provide a flow diagram. If you can't follow it, then I suggest you need professional advice.
The big question, as others have said, is whether they will stand by the advice. In my case, as long as I have a letter from them confirming my tax status, I'm sorted, as I will not be working in UK again.
Reply due in a few weeks - I'll let you know what they say.

Winnerhofer 18th June 2014 20:47

Tax
 
I recall a while back that HMRC (then IR) had won a case against a pilot who was based abroad but work and stayed intermittently in the UK.
Check for double-taxation.
There are endless variables and case law is all about the same facts with different outcomes.
To clear matters, seek independent experts and never take your employer's counsel.

Heathrow Harry 23rd June 2014 12:55

HMRC look at where you work AND where you are "domiciled"

I suspect the guy caught in Winnerhofer's post was British who was actually working abroad (therefore low tax) but he tried for no tax and they got him on the domicile - i.e he was still "really" based in the UK - house, kids, sports clubs, bank accounts etc etc

TBH most people get awa with it unless they get caught in a random check or really bring themselves to the attention of the Feds

cavortingcheetah 25th June 2014 21:23

Probably a reference to HMRC & Grace or Grace and HMRC depending on whose appeal was where. The question was whether Grace was resident in Britain not whether he was domiciled. Double taxation wasn't a feature of the case perhaps because the South African SARS weren't involved.
HMRC publish guidelines to residence which can be a major factor in determining tax status.
http://www.hmrc.gov.uk/international/rdr3.pdf
The world is littered with people who interpreted HMRC rules to suit themselves. Gaines Cooper springs to mind as an ace loser.
The only sensible advice is to spend a little money and get the advice of a professional tax adviser from a reputable firm. Be warned also that what is the rule one day is not the next in Britain where instability in the tax regime is inherent.

umberto65 26th June 2014 03:32

For HMRC residence and domicile are less important than centre of interest. And their interpretation of that is all that matters.

cavortingcheetah 26th June 2014 05:39

Residence and Domicile have been covered by statutes since April 2013. A centre of interest is an argument used in the overall determination of residence or domicile in cases where statutory requirements for determination are blurred. That's just about anywhere other than a very narrow band of, for example, midnights spent in Britain.


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