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TonyTax
TonyTax, Tax Consultant
Category: Tax
Satisfied Customers: 15835
Experience:  Inc Tax, CGT, Corp Tax, IHT, VAT.
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I have been offered a job in Saudi Arabia working full-time My

Resolved Question:

I have been offered a job in Saudi Arabia working full-time
My wife will be staying in the UK
How do I tell whether I am liable to pay UK tax on my earnings (they are tax-free in SA)?
Submitted: 3 years ago.
Category: Tax
Expert:  TonyTax replied 3 years ago.
Hi.

Can you tell me how long you envisage living and working in Saudi Arabia please? Will you be working for a Saudi employer?
Customer: replied 3 years ago.

At least 2 years (SA law requires non-Saudi's to work on 2-year contracts even for full-time employees as I would be)


 


Yes I would be working for a Saudi employer

Expert:  TonyTax replied 3 years ago.
Thanks.

Leave this with me while I draft my answer. There is quite alot to get through so please bear with me.
Customer: replied 3 years ago.

No problem, please don't hesitate to come back to me for further information

Expert:  TonyTax replied 3 years ago.
Thanks for your patience.
Expert:  TonyTax replied 3 years ago.
Hi again.

You might refer to the notes here and here when you have read my answer.

The bare minimum that you need to achieve in order to avoid having to pay UK tax on your Saudi earnings is to spend at least one full tax year (6 April to 5 April) as a non-UK resident individual.

A new statutory residence test came into effect from 6 April 2013 which HMRC claims will make it easier to determine an individual's UK tax status. There is a series of tests which you need to apply to yourself. The second link I gave you is a brief synopsis of the rules which you can read in full in the first link. However, alot of that won't apply to you.

Unless you meet one of the automatic overseas tests, you will be treated as UK resident for tax purposes if you meet one of the automatic UK tests or one of the sufficient ties tests. See paragraphs 1.1 to 1.3 in the guidance note here.

Based on what you have told me, if you will be working full time abroad you will be treated as non-UK resident for tax purposes if you work sufficient hours abroad and spend less than 91 days in the UK in a tax year and no more than 30 days working in the UK. See Definition A here. The other two tests will probably not qualify you as non-UK resident as the number of days you can spend in the UK are very low. Quite simply, you need to spend less than 91 days in the UK in a tax year.

If you don't satisfy any of the automatic overseas tests, you will need to look at the automatic UK tests. Provided you don't fall foul of these tests, you will need to consider the sufficient ties tests and compare the number of days you have spent in the UK with the number of UK ties you have. If the number of ties you have is too many for the number of days you have spent in the UK, you will be treated as UK resident for tax purposes. See the ties table under "Leavers" here. This can be avoided by spending less than 91 days in the UK in a tax year.

I hope this helps but let me know if you have any further questions.
Customer: replied 3 years ago.

Hi Tony, based on Para 1.10 below:


Do you work full-time overseas?


1.10 You will be considered to work full-time overseas if you work for sufficient hours overseas as calculated over the tax year in the case of the third automatic overseas test, or other relevant period in the case of split year Cases 1 or 6. To calculate if you work sufficient hours overseas, take the following steps (for deceased persons follow the steps given at paragraph 4.4)


 


I will not be working in the UK at all and would not be in the country for more than 91 days per year (for some holidays my family will come to the ME) and so assuming I subtract my 30 days holiday as part of the reference period calculation I should have no problem hitting the 37 hrs per week figure.


 


Assuming this is the case then I am non-resident for UK Tax automatically, is that correct?

Expert:  TonyTax replied 3 years ago.
That would be correct.
Customer: replied 3 years ago.

Thank you


 


Can you please email me a copy of this discussion?

Expert:  TonyTax replied 3 years ago.
I'm afraid can't do that as I am not allowed access to customers email addresses. You might ask just answer if they can email it to you or click on file then print at the top of your browser.

Alternatively, save the web address of the question in an email and send it yourself. The question will be here for you to look at for as long as you want it to be.
TonyTax, Tax Consultant
Category: Tax
Satisfied Customers: 15835
Experience: Inc Tax, CGT, Corp Tax, IHT, VAT.
TonyTax and other Tax Specialists are ready to help you
Customer: replied 3 years ago.

Attachment: 2014-03-04_162717_working_days_stuff.xlsx

Hi Tony,

Please see below; this shows when I will hand in notice to the UK employer and when I will leave for KSA. Just want to check that my calculation on no. of days, etc is correct and that, assuming it is, that I still comply with the SRT and remain non-resident for UK tax?

Regards

Alan

 

01-Apr02-Apr03-Apr04-Apr05-Apr06-Apr07-Apr08-Apr09-Apr10-Apr11-Apr12-Apr13-Apr14-Apr15-Apr16-Apr17-Apr18-Apr19-Apr20-Apr21-Apr22-Apr23-Apr24-Apr25-Apr26-Apr27-Apr28-Apr29-Apr30-Apr
ActivityHand in Notice for UK RoleNotice PeriodNotice PeriodNotice PeriodNotice PeriodNotice PeriodNotice PeriodNotice PeriodNotice PeriodNotice PeriodNotice PeriodNotice PeriodNotice PeriodNotice PeriodNotice PeriodNotice PeriodNotice PeriodNotice PeriodNotice PeriodNotice PeriodNotice PeriodNotice PeriodNotice PeriodNotice PeriodNotice PeriodNotice PeriodNotice PeriodNotice PeriodNotice PeriodNotice Period
01-May02-May03-May04-May05-May06-May07-May08-May09-May10-May11-May12-May13-May14-May15-May16-May
ActivityIn UK Prep for new roleIn UK Prep for new roleIn UK Prep for new roleIn UK Prep for new roleIn UK Prep for new roleIn UK Prep for new roleIn UK Prep for new roleIn UK Prep for new roleIn UK Prep for new roleIn UK Prep for new roleIn UK Prep for new roleIn UK Prep for new roleIn UK Prep for new roleIn UK Prep for new roleIn UK Prep for new roleTravel to KSA for new role
No. of UK Days worked for 2014-2015 Tax Year =25
Number of Days Allowed in UK for 2014-2015 Tax Year =91
Number of Remaining Days Allowed in UK for 2014-2015 Tax Year =66to 5th April 2015
Expert:  TonyTax replied 3 years ago.
What date do you intend to leave the UK?
Customer: replied 3 years ago.

Sorry Tony, I tried to attach the file but doesn't seem to have worked.


 


I plan to leave the UK on Friday 16th of May

Expert:  TonyTax replied 3 years ago.

Thanks.

The tax year you during which leave the UK and the tax year that you return to the UK are called split years. Your foreign earnings between those dates of departure and return will be UK tax exempt so long as you maintain your non-UK residence status in the interim.

The number of days that you can spend in the UK in 2014/15 between 16 May 2014 and 5 April 2015 assuming you leave the UK on 16 May 2014 is 82 and of these, you cannot work in the UK for more than 27. See Table E on page 5 of booklet RDR3 here. You don't include the period 6 April 2014 to 6 May 2014 in the calculation of days you are able to spend in the UK. That's why the tax year of departure is called a split year.

Customer: replied 2 years ago.

Hi Tony; I have a new question, would it be easier to start a new thread?


Alan

Expert:  TonyTax replied 2 years ago.
Yes, but you will need to ask for me by mentioning my name in the question if you want me to answer it.
Expert:  TonyTax replied 2 years ago.
By the way, your table came through. The number of days you spend in the UK before you leave the UK does not have any effect on the number of days you can spend in the UK during the overseas part of the tax year if you leave the UK after 30 April 2014. See Table E on page 53 of RDR3 here.
Customer: replied 2 years ago.

Thanks that's in line with what you stated earlier


 


I'll send the new question on this thread later today if that's ok, it's to do with potential tax rebate for the 2013-2014

Expert:  TonyTax replied 2 years ago.
I saw your own table which hadn't come though when I answered previously so I thought I'd mention it..

OK. Make sure you mention my name in the new question if you want me to it.
Customer: replied 2 years ago.

Hi Tony Tax


New Question: When completing my Tax Return for 2012-2013 I was self-employed and, based on my earnings for that year, HMRC insisted upon a Payment on Account against my 2013-2014 Tax and it was a substantial sum which I paid in January 2013 along with my 2012-2013 tax. I ceased to be Self-Employed on 31st December 2012 and have been part of a PAYE system since January 2013 so my question is:


When I complete my self-assessment for 2013-2014 my expectation is that I will get the Payment on Account money refunded with interest, as my earnings since January 2013 have all been on a PAYE basis and so I will have no tax payment to make for that element?


 


 

Expert:  TonyTax replied 2 years ago.
You will need to post this as a new question as it is on a completely different topic. If you want me to answer it, you will need to mention my name in the body of your question or someone else will answer it.
Customer: replied 2 years ago.

That's why I was asking earlier whether to start a new thread or not, will do so now

Expert:  TonyTax replied 2 years ago.
OK.
Expert:  TonyTax replied 2 years ago.

You didn't post your new question for my attention so I cannot guarantee that it will be left for me to answer, though I have my answer ready.

Customer: replied 2 years ago.


I tried 4 times to post it to you, however, each time the system gave me a different expert and no option to change it? If you can let me know how to reassign it I'd be happy to do so?

Expert:  TonyTax replied 2 years ago.
I haven't asked questions here so I don't know the ins and outs. You could have just mentioned my name in the body of the question, eg for attention of TonyTax. It looks like its been looked at now.
Customer: replied 2 years ago.

I did that and I also posted the question under your profile 4 times, but it didn't help at all, the system just allocated someone else. From your perspective it may be worthwhile raising this with the justanswer people as it is not to your benefit if clients cannot select you?

Expert:  TonyTax replied 2 years ago.

Thanks for the heads up. You need to put my name as part of the question as you did here when you asked the tax return question originally.

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