Tax Tip

The Treasury has set out two consultation papers, one on reforming the tax system as it applies to non-domiciled residents, and another on its plans for a statutory residence test (SRT).

The Government states that the aim is to encourage individuals to invest in the UK while also ensuring a fair tax contribution.

The consultation provides details on the package of reforms that were announced at Budget 2011, including increasing the existing £30,000 annual charge to £50,000 for non-domiciles who claim the remittance basis in a tax year and who have been UK resident in 12 or more of the 14 years prior to the year of claim; allowing non-domiciles to bring overseas income and capital gains to the UK tax-free for the purpose of commercial investment in UK businesses; and simplifying the way in which some aspects of the current rules work.

A Treasury spokesman said:

“……it is important that skilled individuals and investors are encouraged to come to the UK from abroad and we recognise the fact that non-domiciles can make a valuable contribution to the UK economy. That is why we want to make it easier for them to invest in UK business."

The Treasury is proposing a framework for the SRT. There are to be four areas of consideration: accommodation; family residence; UK employment or self-employment; and a history of past residence.

Lavinia Newman, Founder of ABDS says:

“Both of the consultations close on 9 September 2011, with a summary of responses due to be published in the autumn. We at ABDS will keep you informed.”

If you need any help and advice on Business Financial Planning and Development, don’t hesitate, contact Lavinia Newman, Stuart Coleman or Tonmoy Kumar NOW to discuss how ABDS can help in all your Business needs.

ABDS Chartered Certified Accountants of Southampton.

Tel: 023 8083 6900  E-mail: abds.marketing@netaccountants.net