Do I need to pay TAX?

Randvegeta

Hello all,

I am currently a 'self-employed overseas worker'. And by that I mean,

1. I work for myself.
2. My business/income is derived from overseas.
3. My business is registered overseas.

I am a UK resident but not domiciled. I therefore understand that my foreign income is taxable only if remitted to the UK. I have so far been sending myself under my TAX free allowance to avoid paying UK income TAX. That being said, £7,000 is not exactly a luxurious life style, and I would be much happier if I could send more of my money over.

First off, I'm only really in the UK as my GF is still studying at University and as a self-employed person, I do have quite a bit of freedom with regards to work and travel.

Is there a way for my to send myself more of my hard earned cash to the UK without being liable to pay UK income TAX on it?

There are a few other options I have thought of but am not sure if it falls under the domain of 'TAX evasion'.

Here are my ideas:

1.) If I buy something with my overseas debit card (i.e. pay by card to go shopping/visit the cinema/eat out) does this count as remitting earnings to the UK?

2.) If I buy something with an overseas credit card (similar situation to above) does this count as remitting earnings to the UK?

3.) If I buy something with my company debit/credit card, are there any TAX implications for this? My company is a registered, limited company overseas. Therefore I would technically not be spending my OWN money.

In case anyone out there is going to reply "PAY YOUR TAXES, BLAH BLAH BLAH". I would just like to say,

- I'm living here temporarily, and do not intend on taking out anything from the system.

- I am not taking any British or EU jobs/business.

- I am bringing in, and spending my hard earned income to this country, which is to the benefit of this country. Meaning, I bring money IN, and I take nothing out.

My current lifestyle would suggest that the UK Gov will recieve from me, at most £1,400 in TAX based on the 20% VAT rate. And that is assuming everything I buy carries that rate of VAT (if any). What I want to do, is bring in even MORE money and SPEND more money, which I am sure everyone here will agree is a GOOD thing. But I don't want a big chunk to disappear for no reason.

Anyway, thanks for taking the time and giving your advice!

chrismac1

I suspect you've not fully read the tax rules on non-domicile status. Once you tick that box on your tax return, the tax bill increases to £30,000. Does this change your mind at all? If you are deemed to be a UK resident for tax purposes - and my guess is you are - then you are taxed on your worldwide income. You will get double tax relief (in most countries) for any tax you pay on your business in a foreign country.

antrobus

I believe that the available options are as follows;

(1) keep under the radar and hope that HMRC never become aware of your existence
(2) find a decent accountant and make your peace with HMRC

le_loup

Randvegeta wrote: »

I'm living here temporarily, and do not intend on taking out anything from the system.

So, you're not enjoying any UK infrastructure. Where are you living, on a small rock in the Atlantic?

Randvegeta

Le Loup,

Yes indeed I am enjoying UK infrastructure, as do the many layabouts on benefits as well as tourists. What a drain I must be. FYI, I am UK citizen (born British). But if you believe my being here is somehow adding to the problem of this country, please do explain.

Chrismac, I have read that somewhere but I believe that applies to long term residents who are non-doms. Since I am not really a long term resident, this should not apply to me. That being said, I am currently working on what I have read here: direct.gov.uk/en/MoneyTaxAndBenefits/Taxes/LeavingOrComingIntoTheUK/DG_10027480 .

Antrobus, I really do not wish to do anything illegal. I have thus far, to my knowledge, remained within the walls of the law. What I would like to do, is find some legal way to bring/spend more money in the UK without increasing my TAX liability.

The double taxation treaty would probably apply, however the TAX I pay overseas is but a small fraction of what I would have to pay in the UK, meaning I would have to pay the difference here.

chrismac1

Well as long as you've not been here for 7 out of the past 10 tax years the £30k hit does not apply to you.

So I think you're in exactly the position of the high roller long term non-doms the £30k was brought in for - in other words a very favourable UK tax position.

I do not claim to be an expert on tax residence status, but at least you have a decent argument for what you plan to do.

Randvegeta

Well I have spent 5 of the last 6 years living in the UK. So it should be fine. Indeed it seems to be a good TAX position, but still, I am limited to my 7,xxx GBP /yr allowance in terms of remittence. Damnit, that just won't do! lol. I need MORE!

antrobus

OK. Perhaps I was reading too much into your description of yourself as being 'self employed'.

But what is the nature of your company's business, and where is the work carried out that produces its income?

Randvegeta

In a nutshell? Internet/Online services. Primarily through webhosting. All of my servers and equipment are located in another country (where the company is registered). There is other work done too, like web development, etc. But again, this is paid to the company. So technically, any software work that I do is done wherever I am physically located, but the bulk of my income comes from services rendered outside.

antrobus

Randvegeta wrote: »

In a nutshell? Internet/Online services. Primarily through webhosting. All of my servers and equipment are located in another country (where the company is registered). There is other work done too, like web development, etc. But again, this is paid to the company. So technically, any software work that I do is done wherever I am physically located, but the bulk of my income comes from services rendered outside.

And you are physically located in the UK, at least for 5 out of the 6 past tax years. Have you taken any professional advice regarding your tax position?

Randvegeta

I spent the 2006 - 2010 studying here. I spent a year working abroad and have continued with my business. My GF is still studying at UNI so I'm here because I want to be close by.

I have not spoken to a TAX professional yet. Are they expensive? Where would one find one?