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TonyTax
TonyTax, Tax Consultant
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Hello I have shares in some overseas companies held through

Resolved Question:

Hello

I have shares in some overseas companies held through Barclays Stockbrokers,
These are Catlin, New City High Yield Fund, Phoenix Group, Schroder Oriental Income Fund, Picton property Income, and Acorn Income.

They are based in places like Guernesy, Bermuda, and Jersey.

I noticed on the statement from Barclays that there is no dividend credit.

I am liable for tax on the dividends from these investments.

They are not in a Sipp or Isa, I am a standard rate UK taxpayer,

Thank You

Peter Rolfe
Submitted: 3 years ago.
Category: Tax
Expert:  TonyTax replied 3 years ago.

Hi.

 

 

Are you asking if you are liable to UK tax as you say "I am liable......" in your question. Are you a UK national? Do you receive income from the inverstments?
Customer: replied 3 years ago.

Hello


 


Iam a Uk national, I receive dividend income form these


investments. Normaly with dividend income there is a tax credit


of 10%, but this does not appear t be the case with these that I have listed,


 


 

Expert:  TonyTax replied 3 years ago.

Thanks.

 

Leave this with me while I draft my answer.

Expert:  TonyTax replied 3 years ago.

Hi again.

 

I apologise for the delay in posting my answer. The internet browser that this site works best with is having technical issues.

The fact that these companies are based in tax havens means that there will be no UK tax credit attached to their dividend payments. They won't be listed under the UK dividend section of your Barclays investment report for that reason. They are foreign dividends or interest (see below) and should be reported as such in your tax return's foreign pages SA106 which you can see here.

If you are a 20% taxpayer, then you will be liable to tax at 10% on the dividends but as you will read here, you will be given a 10% notional tax credit for most foreign dividend receipts which will effectively cover the UK tax liability of a basic rate taxpayer. Only if foreign tax has been deducted will you be able to claim relief for it against your UK liability as shown in the example on page 3 here and in accordance with the relevant double tax treaty.

I would be surprised if there was any foreign tax deducted from the dividends you have received. The notes on pages, FN7, FN8 and FN9 here deal with dividends from offshore funds and preclude such dividends being given a notional 10% tax credit. The notes on page 9 expand on this especially in relation to dividends from Jersey and Guernsey based and depending on how the funds invest, you may be liable to 20% UK tax as opposed to the 10% dividend rate. You should consult the companies you have invested in or Barclays Stockbrokers for clarification on this.

I hope this helps but let me know if you have any further questions.

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