Journal 019 – I’m reviewing, the situation; I think I’d better think it out again

A dilemma for Fagin, in the 1968 stage musical, Oliver, and today for anyone thinking of emigrating from the UK just to save tax

Not so long ago, it was possible to go live in any one of a number of countries, for just one year, and have no Capital Gains Tax (CGT) to pay on just about any size gain. Those days are gone, unless you live outside the UK for more than 5 years

That’s not the end of the story though. If the company you sold before you became non-resident consisted of 75% or more UK property, then CGT may still be payable (but only on any increase in value since April 6th 2019)

Back in the day, it was possible to withdraw company profits by way of tax-free dividends during a short period of non-residence. Anti-avoidance rules are now in place but there are still a couple of exceptions

The anti-avoidance rules don’t apply to dividends paid out of profits made post departure

Interestingly, the rules only apply where an individual has been UK resident in at least 4 of the 7 years prior to the tax year in which they became non-resident

If you’re planning to leave the UK anyway, that’s different. Then, it might be possible to combine living in a dream destination with a lower tax bill

Time for a statement of the ‘bleedin’ obvious’ – if you’re planning to emigrate to mitigate UK taxes then you need to take professional advice

Our team of Chartered Tax Advisors work with clients from all parts of the UK and in most countries of the world. They deal with all the rules and regulations and are well placed to help you

Let us review your tax planning. Experience the Power of a FREE Hour here.

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