Tax on UK income if I live abroad

jumperabv3

I'm an EU citizen living outside the UK now.
I am paying and reporting tax on my UK income every year using Self Assessment. According to my UK accountant as well to this:

https://www.gov.uk/tax-uk-income-live-abroad/personal-allowance

I can claim UK tax allowance every year because I am a "citizen of a European Economic Area (EEA) country".

My question is - after the election (I'm personally unhappy with the result) - would I lose the entitlement to claim UK tax allowance in the future?

According to this:

https://www.bdo.global/en-gb/microsites/tax-newsletters/ges-newsletter/october-2019-issue/united-kingdom-hmrc-update-on-the-availability-of-the-tax-free-personal-allowance-after-brexit

"HMRC confirmed that it is their intention to continue to allow EU nationals to receive the personal allowance when the UK leaves the EU."

Is this reliable?

BoGoF

As reliable as anything at the minute.....which could change.

What UK income do you have that you are paying tax on in the UK.....and why?

jumperabv3

BoGoF wrote: »

What UK income do you have that you are paying tax on in the UK.....and why?

Rental income, when I left the UK I bought the property I was renting/letting from the landlord, 1 bedroom property. The allowance made it easier with taxes, if they don't pass the allowance I'd probably sell it.

BoGoF

Regardless of the UK tax allowance at present surely you are still paying tax on the rental income in your 'home' country?

jumperabv3

BoGoF wrote: »

Regardless of the UK tax allowance at present surely you are still paying tax on the rental income in your 'home' country?

Yes, but the rate is quite low, so the allowance makes quite a substantial difference.

Ben8282

If your UK income consists of nothing but the rental from one small property and your are submitting tax returns to HMRC, whatever are you paying a UK accountant for?
If you are reporting this income in the UK and are paying tax on it in the UK, I don't think you should be declaring it again and paying tax on it again in your home country as it has already been declared and taxed in the UK.

Sibbers123

Ben8282 wrote: »

If your UK income consists of nothing but the rental from one small property and your are submitting tax returns to HMRC, whatever are you paying a UK accountant for?
If you are reporting this income in the UK and are paying tax on it in the UK, I don't think you should be declaring it again and paying tax on it again in your home country as it has already been declared and taxed in the UK.

That's exactly why everyone should have an accountant. It is advice like this that is completely incorrect.

The actual tax treatment will depend on the double taxation treaty between the UK and the other country in question. In all likelihood it will be taxable in the UK (the UK will have primary taxing rights) but it will also be taxable in the other country with a claim for double taxation relief.

UK Tax law is very rarely common sense and a competent accountant will generally save you more tax than they will charge you in fees.

jumperabv3

Sibbers123 wrote: »

That's exactly why everyone should have an accountant. It is advice like this that is completely incorrect.

The actual tax treatment will depend on the double taxation treaty between the UK and the other country in question. In all likelihood it will be taxable in the UK (the UK will have primary taxing rights) but it will also be taxable in the other country with a claim for double taxation relief.

UK Tax law is very rarely common sense and a competent accountant will generally save you more tax than they will charge you in fees.

That is correct.
My home country in fact is even giving me tax credit (tax refund) for paying too much in the UK but they have a limit to it - so basically without the allowance I would find myself spending something like £2,000/year and I am not very keen on spending this amount just because the UK govt feels like flexing its muscles with Europe (I hope they won't).

Likewise the value of the pound has already dropped to super low levels, and I'm getting less income in my home country from the rent, so I see more reasons to sell as I also have low faith in Boris' Brexit, I personally think the UK is making a huge mistake with all this, but I'm waiting to see if perhaps the new govt will come to is senses and would be lenient with its new legistlation for post-brexit, in this way I wouldn't mind leaving the property as is and keep on paying tax on the rent etc.

BoGoF

Rightly (in my opinion) or wrongly the UK government has made it more expensive for non-residents to acquire UK properties. Whether or not that extends to abolition of personal allowance for EU/EEA nationals remains to be seen but would seem a natural progression.

bairn7

Sibbers123 wrote: »

That's exactly why everyone should have an accountant. It is advice like this that is completely incorrect.

The actual tax treatment will depend on the double taxation treaty between the UK and the other country in question. In all likelihood it will be taxable in the UK (the UK will have primary taxing rights) but it will also be taxable in the other country with a claim for double taxation relief.

UK Tax law is very rarely common sense and a competent accountant will generally save you more tax than they will charge you in fees.

They will also ensure that the correct reporting procedures are followed (in this case the non-resident landlord scheme). Presumably this is all in order for the OP.

jumperabv3

BoGoF wrote: »

Rightly (in my opinion) or wrongly the UK government has made it more expensive for non-residents to acquire UK properties.

Yes, that's right ... in some way I agree with lowering housing prices, but taxes for all EU citizens is not only something that starts and ends with rentals ... there are many other scenarios where EU citizens can pay UK tax - I hope the article I brought in the beginning of this thread would reflect the near future reality.