Investing Abroad, earning on my investments but living in the UK

Mitchell_Leary

Ok, I'm new here but this site seems like the perfect place to start for answering a query that I have.

I live in the UK but travel quite a bit and have found an excellent investment opportunity that gives high, fast returns which I am going to set up within the next few months on my next trip. I expect my investment to begin to give me quite a large income which I plan to send back to the UK where I will be living.

My worry is obviously regarding money-laundering laws and whether or not the UK government will want me to pay some sort of tax?

So;

- Will I have to pay a tax on an investment in another country in the UK?
- When sending my money to the UK, will I have to prove where it has come from and if so, how?
- Will I have to declare the money when I send it to the UK?
- What is the best way for me to secure this money and send it to the UK without having problems?

Any other advice or thoughts would be very much appreciated.

Thanks in advance,

Mitch:j

Aegis

Mitchell_Leary wrote: »

Ok, I'm new here but this site seems like the perfect place to start for answering a query that I have.

I live in the UK but travel quite a bit and have found an excellent investment opportunity that gives high, fast returns which I am going to set up within the next few months on my next trip. I expect my investment to begin to give me quite a large income which I plan to send back to the UK where I will be living.

My worry is obviously regarding money-laundering laws and whether or not the UK government will want me to pay some sort of tax?

So;

- Will I have to pay a tax on an investment in another country in the UK?

Yes. UK residents are liable to income tax on their worldwide assets, not just the ones in the UK. The only exception is for non-domiciles where the income isn't remitted to the UK.

- When sending my money to the UK, will I have to prove where it has come from and if so, how?

Your bank will decide that. If they are suspicious of the origin of the funds, they may freeze your account to ensure that they are satisfying money-laundering regulations.

- Will I have to declare the money when I send it to the UK?

You'll already be paying tax on the earnings abroad, so probably not specifically. If you are selling for a gain, you will need to declare the capital gain through self assessment and pay tax at the usual rate.

- What is the best way for me to secure this money and send it to the UK without having problems?

Don't do anything illegal or get involved with dodgy companies and you'll be fine. Be sure to declare everything to the taxman though, as they really hate tax evaders, even if it's accidental.

Mitchell_Leary

Aegis wrote: »

Yes. UK residents are liable to income tax on their worldwide assets, not just the ones in the UK. The only exception is for non-domiciles where the income isn't remitted to the UK.

Would my wife be classed as a non-domicile as she doesn't have her residency here in the UK?

Aegis wrote: »

You'll already be paying tax on the earnings abroad, so probably not specifically. If you are selling for a gain, you will need to declare the capital gain through self assessment and pay tax at the usual rate.

Does this mean I would be paying tax twice on my earnings? Once in the country I am investing in and a second time for capital gain?

Thanks again

Aegis

Mitchell_Leary wrote: »

Would my wife be classed as a non-domicile as she doesn't have her residency here in the UK?

If she is non resident (i.e. doesn't live in the UK for more than half of the tax year or make "habitual and substantial" visits to the UK) then she may be exempt from UK tax for earnings abroad. You'd probably better check with a tax specialist on the ramifications of her residency though, especially if you are the one who will ultimately benefit from the money being brought to the UK.

Does this mean I would be paying tax twice on my earnings? Once in the country I am investing in and a second time for capital gain?

This will depend on the level of tax deducted and whether the UK has a double-taxation treaty in place with the country that you're investing in.

Mitchell_Leary

excellent advice Aegis thanks alot!

Aegis

Mitchell_Leary wrote: »

excellent advice Aegis thanks alot!

Just to make it complete, be VERY careful where you invest outside the UK. Here we have the Financial Services Compensation Scheme protecting investors if the providers go bust, and investments must be authorised by the Financial Services Authority to be marketed legitimately. Abroad, especially in countries outside mainland Europe, there may be little or no regulation of such products, and you may find yourself on the wrong end of a scam with no recourse to any compensation.

Make sure you know exactly what you're investing in and where the return is going to come from.

Cook_County

From an investment perspective you need to know if the investment is permitted to be sold in the UK.

Where, Mitchell, are you domiciled?

What kind of investment is it? The UK has a tough set of anti-avoidance rules and this sounds to me as if it would be caught under the transfer of assets abroad rules.

property.advert

Unless you are talking about serious amounts of money, then remember that the ATM network is a great way to move funds. You can easily withdraw money, say from an offshore account based in Singapore with Citibank, anywhere in the world and no-one would ever bat an eyelid. Obviously not for tens of thousands a month but for the odd £500 a time withdrawal, it is by far the easiest.

Aegis

property.advert wrote: »

Unless you are talking about serious amounts of money, then remember that the ATM network is a great way to move funds. You can easily withdraw money, say from an offshore account based in Singapore with Citibank, anywhere in the world and no-one would ever bat an eyelid. Obviously not for tens of thousands a month but for the odd £500 a time withdrawal, it is by far the easiest.

It's also pretty much the most expensive way to do it. Typically you'll get a rubbish exchange rate and will also be charged a fee by the card provider, and possibly by the ATM owner as well.

Plus there's no reason to use this method unless you're actually trying to evade tax. It's easier to simply make an online payment from your offshore account to an onshore one. Takes about 2 minutes and doesn't require you to leave the house, and it's a lot more secure.

Jonbvn

Mitchell_Leary wrote: »

I live in the UK but travel quite a bit and have found an excellent investment opportunity that gives high, fast returns which I am going to set up within the next few months on my next trip. I expect my investment to begin to give me quite a large income which I plan to send back to the UK where I will be living.

OP,

This sounds awfully like something possibly illegal or perhaps a scam??

Be very careful.

Mitchell_Leary

Cook_County wrote: »

From an investment perspective you need to know if the investment is permitted to be sold in the UK.

Where, Mitchell, are you domiciled?

What kind of investment is it? The UK has a tough set of anti-avoidance rules and this sounds to me as if it would be caught under the transfer of assets abroad rules.

I live in the UK but travel quite often for business outside of the UK. I will have lived for more than 6 months outside of the UK by the end of the year I believe.
The investment is property in an emerging economy, building and selling houses. The economy there is now very stable and growing fast with the major cities growing rapidly each year with neighbourhoods being built on the outskirts. This is what I will be involved in.
Do you think that would infringe transfer of assets abroad rules?