The Long Arm Of UK Taxation

05.11.14

Please note that this article is over six months old. While Blevins Franks takes care to make sure that information is accurate on the date of publication, some content may change over time. You should not rely on the accuracy of legislation and tax information in this article; take professional advice for your circumstances.

UK Chancellor George Osborne seems on a mission to raise more taxes from non-UK residents. This is a good time to reconsider the tax efficiency of your UK assets.

We are so used to blaming President Hollande, and M. Sarkozy before him, for our higher taxes, it is easy to overlook the tax threat from across the Channel.  

UK Chancellor George Osborne seems on a mission to raise more taxes from non-UK residents.

The first strike was the decision to start charging capital gains tax on residential property owned by non-residents, regardless of how many years you live abroad. A government document released with the December Autumn Statement confirmed that this will apply to gains arising from 6th April 2015.  

The government is also considering withdrawing the £10,000 tax free personal allowance from non-residents, except those with a strong economic connection to the UK.  This is expected to earn the government up to £400 million a year.  The Autumn Statement did not provide any more information, other than to say that that the government still believes there is a “strong rationale” for removing the allowance from non-residents, but since this is a complex change consultation will continue on the matter.

This may affect you if you receive income from the UK, such as rental, investment and pension income.  You need to understand the interaction between French and UK taxation and how this impacts you.

This is a good time to reconsider the tax efficiency of your UK assets. Those who own rental property in the UK could be hit first on rental income, then when they sell the property.  If you sell the property now you could use the funds to invest in such a way that lowers your liability to income tax and social charges; potentially minimises wealth tax; reduces exposure to French succession tax and avoids UK inheritance tax completely.

Please CLICK HERE to contact us to discuss your options and establish the most tax efficient way forward.

Tax rates, scope and reliefs may change.  Any statements concerning taxation are based upon our understanding of current taxation laws and practices which are subject to change.  Tax information has been summarised; an individual is advised to seek personalised advice.

Tax rates, scope and reliefs may change. Any statements concerning taxation are based upon our understanding of current taxation laws and practices which are subject to change. Tax information has been summarised; individuals should seek personalised advice.

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