Foreign Income

davidrle

Up until June 2010 I was working self employed in the UK on a freelance basis for a radio station.

In June I left to go do a bit of travelling.

By August 2010 I had arrived in Canada where I worked in a minimum wage job earning and paying tax directly off my wages there. I worked that job for 11 months.

I arrived back in the UK in September of this year.

So for the tax year beginning April 2010, in the UK I only earned £3611.48

Now doing my tax return for April 2010 - March 2011. The question is, should I be paying any tax in the UK on my Canadian earnings?

I paid a high level in tax while in Canada, so I'd assume no. The only thing I could think of is that any income in Canada would account for my personal threshold in the UK, so I should be paying tax on that 3611.48?


David

antonic

There is a UK/Canada Dual Taxation agreement - google this phrase and it will take you to the relevant part on the HMRC website.

davidrle wrote: »

Up until June 2010 I was working self employed in the UK on a freelance basis for a radio station.

In June I left to go do a bit of travelling.

By August 2010 I had arrived in Canada where I worked in a minimum wage job earning and paying tax directly off my wages there. I worked that job for 11 months.

I arrived back in the UK in September of this year.

So for the tax year beginning April 2010, in the UK I only earned £3611.48

Now doing my tax return for April 2010 - March 2011. The question is, should I be paying any tax in the UK on my Canadian earnings?

I paid a high level in tax while in Canada, so I'd assume no. The only thing I could think of is that any income in Canada would account for my personal threshold in the UK, so I should be paying tax on that 3611.48?


David

jennifernil

Basically, you have to declare the Canadian income here, but you can claim relief for the tax already paid in Canada, but only up to the amount it would have been here.

If you paid more tax in Canada than you would have here on the same income, you cannot claim it back here.

If you only earned £3611.48 here, and paid a lot of tax in Canada, it sounds unlikely you would have any tax to pay on the £3611.48, but it depends on your figures of course.


Info here.....

http://www.hmrc.gov.uk/worksheets/sa106-notes.pdf

and here.....

http://www.hmrc.gov.uk/helpsheets/hs263.pdf

Cook_County

Don't forget that the Canadian tax year is less quaint than the British and you will need to file in Canada to figure out the foreign tax creditable in the UK.