UK tax on foreign earnings for temporarily non-residents

john877

In October 2012 I moved to the Middle East. Although I kept my house, wife and children in the UK (for schooling reasons), I had a good job abroad with a 3-year contract. My employer gave me use of a house and a local residency permit. I intended to stay for the full 3 years, and so I submitted a P85, an in-year SA form for 2012-13, and declared myself non-resident, which HMRC accepted.

While I was earning money abroad, I used to send money back to the UK regularly, and it was my understanding that as I was non-resident, I did not have to pay any tax on it.

Due to an unexpected and sudden legal problem at work, I was forced to return to the UK in December 2013, pending resolution of the legal problem. I am still officially employed in that country, I still have the local residency permit and the keys to my house which still contains my possessions. I am intending to return there once the legal matter is satisfactorily resolved, and my employer has accepted that.

My salary was stopped on my departure, so in the meantime I commenced freelance work in the UK on a self-employed basis. In the 2013-2014 tax year I have been in the UK for 135 days, and I have worked here on 53 days. I have untaxed income from the freelance work, and I intend to pay the tax through self-assessment.

However, due to circumstances beyond my control, I have not been non-resident for a complete April-to-April tax year. So my query is this... - do I have to pay tax on my foreign income which was earned and remitted between October 2012 - December 2013?

Many thanks for sharing your experience and insight into my problem.

Savvy_Sue

One question you need to answer is whether you were paying tax on that income in the country in which you were working? And whether there is a dual taxation treaty between the UK and that country?

I don't know the answer either way, but I don't think anyone can answer without know those things.

john877

Qatar: Although there is a dual taxation treaty, there is however no personal income tax in that country.

pjclar02

The requirement is that you leave the UK on a contract to work overseas that lasts a whole tax year. From what you have said, this was the case as the contract did span a complete tax year. Therefore, if you spend less than 183 days in the UK during the tax year, your overseas earnings should still escape UK tax