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Tax for Individuals / December 23rd 2014
What is the difference between residence and domicile for UK tax purposes?When it comes to completing your UK self-assessment tax return, there is often a lot of confusion between your residence and your domicile with many believing that both concepts are the same. This is not the case as being a UK resident or UK domiciled can have very different consequences from a tax perspective. Domicile This is your ‘long term home’ and there are 3 types of domicile. Origin – at birth, you will take the domicile of you father (unless your parents are not married then you take the domicile of your mother). Dependency – until the age of 16, if your father (or mother) changes domicile, your domicile will follow suit. Choice – after 16, you are able to change your domicile. The benefit of being non-UK domiciled is that the remittance vs arising basis election is available to you. This is covered in the remittance vs arising basis page found here. Residence The residency rules in the UK were amended as of 6 April 2013. To determine your residence, you will have to apply the Statutory Residence Tests (SRT) which consists of 3 tests and are applied in the following order: Automatic overseas Test, Automatic UK Test, Sufficient Ties Test. Within each test, there are a number of specific tests to determine your residence and how you will be taxed in the UK. If you would like more information or have any questions about how to determine your residence or domicile, then please do not hesitate to contact one of our tax specialists at 020 8429 9245 or email info@wisteria.co.uk.
Read ArticleTax for Individuals / December 23rd 2014
When it comes to completing your UK self-assessment tax return, there is often a lot of confusion between your residence and your domicile with many believing that both concepts are the same. This is not the case as being a UK resident or UK domicile
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Tax for Individuals / November 20th 2014
Inheritance tax is normally payable upon the death of an individual, but can also be due during the lifetime of an individual when they make a chargeable lifetime transfer. However there are a number of lifetime gifts that can be made free of IHT,
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Tax for Individuals / September 23rd 2014
If you are not a UK resident (for tax purposes) for the full tax year, it is possible to claim to be assessed on the split year treatment. Under HMRC’s new Statutory Residents Tests (SRTs), UK individuals are subject to three separate tests to dete
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Tax for Individuals / January 15th 2014
A deductible expense is a cost incurred which can be claimed when calculating taxable profits from a business or income source. Individuals with rental properties will incur expenses which may or may not be deductible when calculating the profit wh
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Tax for Individuals / January 10th 2014
Capital gains tax (CGT) is a UK tax which applies on any gain realised on the disposal of most assets. Depending on the amount of this gain, the rate of CGT that will apply is up to a maximum of 28%. However there is also an annual exemption of j
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Tax for Individuals / January 9th 2014
In the UK, you may be required to prepare an individual self assessment tax return for a number of reasons. This return applies to individuals, normally where they receive income which is not fully taxed at source. (more…)
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Tax for Individuals / November 19th 2013
Paying National Insurance Contributions (NICs) build up your entitlement to state benefits and state pensions. The total amount of NICs contributed depends on your average weekly earnings and there are a number of different percentages of NICs for ea
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Tax for Individuals / August 8th 2013
Most owner-managers of companies will often have to make a decision about how they take money from the company. Of course, a salary is paid to an employee, whilst a dividend is paid to a shareholder. In many small companies, there will be one owner,
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Tax for Individuals / August 8th 2013
Just like for income tax, each individual has an annual exempt amount for capital gains tax purposes. The annual exempt amount is simply the value of gains that they can realise without paying capital gains tax. This amount is generally increased eac
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Tax for Individuals / April 19th 2013
There are a number of investments which benefit from tax efficient status. The first of these tax efficient schemes is an Individual Savings Account (ISA). These are widely available from high street banks and building societies. Returns (interest,
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