New conditions for foreign investors living in the United Kingdom
The UK Investor Visa has always been popular with Russian nationals since the UK is a multicultural country with something for all tastes and where the rule of law is upheld and observed by all.
However, some investors may now think twice before staying in the UK since the government is discussing the possibility of introducing amendments to the rules by which incomes
The fate of the initiative is still uncertain: the UK Parliament approved the Finance Bill 2017 this April, but it did not include provisions
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Who is considered a "domiciled resident"?
Two concepts exist in the UK: "residence" and "domicile". Tax residence is determined by the number of days spent in the country and depends on a number of factors: for example, on whether the family of the individual resides in Britain, whether
The term “domicile” is used to mean the country of "habitual residence": the state the investor regards as their home and where they plan to return.
Determining
As a general rule, UK tax residents are obligated to pay taxes on their total income and capital gains worldwide. However,
Within the first seven years after becoming recognised as a UK tax resident, this concession can be obtained for free by making an application. Following this
What other changes do the amendments imply?
The changes will also affect property ownership.
Today, acquiring a property in the name of a foreign
For the time being, the planned changes do not affect property transferred to a trust prior to the enactment of the amendments.
The rules will also be tightened for those who were born in the UK but have exchanged their UK domicile for a foreign one. According to the reform project proposed, if such people return to their country of birth and acquire tax resident status there, they will automatically be considered domiciled in the UK. This means that they will have to pay the UK income and capital gains taxes. An additional criterion is to be introduced for inheritance tax: those who reside in the UK for at least one of the two previous years will acquire UK tax resident status. Under these circumstances, investors will have to calculate the tax consequences not only for themselves but also for their children.
Originally published on everyinvestor.co.uk
Ekaterina Shabalina, Tranio lawyer
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