Have Tax Questions? Ask a Tax Expert for Answers ASAP
Hi.The bare minimum qualification for avoiding UK tax on foreign earnings is that you must complete at least one full tax year (6 April to 5 April) as a non-UK resident. Unless you leave the UK on 5 April, this will normally be the start of the next tax year after you leave the UK several months beforehand. The criteria for establishing non-UK residence can be found here and here.You need to go through the automatic overseas tests first to see if you meet one or more of those. If you do, that's fine and you should pay no tax on your Yemen earnings.If you don't meet any of the automatic overseas tests and you won't if you if you spend more than 91 days in the UK in any one tax year then you have to look at the automatic UK tests. If you don't meet any of those tests and you won't if you have a home abroad, whether rented or owned, then you will need to consider the UK ties test. Take a look a the table for "Leavers" about halfway down the page here.If you were treated as UK resident in the tax year of your departure from the UK, you may qualify for split year treatment for that tax year but you would still need to complete at least one full tax year subsequent to the nsplit tax year as a non-UK resident to avoid a belated UK tax liability. You might qualify for split year treatment under the Case 1 criteria. Take a look at Table E on page 53 of RDR3. That tells you the number of days that you can spend in the UK in the overseas part of the split tax year depending on the month of your departure from the UK.Based on what you have told me, you are unlikely to qualify for tax free status for your Yemen earnings. You would need to spend far fewer days in the UK and still work sufficient hours abroad.
You may find the flowcharts here useful.I hope this helps but let me know if you have any further questions.
Thanks for your answer. Very confusing for me. What if I just keep all my salary in my Abu Dhabi bank account and use my credit card in the UK? Do I need to tell the Tax Man i'm working?
Thanks so far.
I have been out of the country now for 3 years, only spending less than 3 months a year back at home so should be safe for what I have done so far.
If I were to take this job and just come home for 6 months a year, how much tax would I have to pay? My salary would be 30000 pounds.
Also I have a Military pension, approx 9000 pounds a year and I've paid tax on that for the last 3 years, should I have or is that correct?
Afghanistan, for 2 years working for a Swiss company, Supreme, who look after the US Military.
1 year in Abu Dhabi from May 2013 until now.
You said the first 10,000 would be my personal allowance, does the pension not count towards this also. I was thinking I would have to pay on the whole 30000 because of the pension which would cover my allowance. 4000 isnt so bad, if I get half the year off paid.
If I go ahead and accept the job, what would be the next steps I need to take in regards ***** ***** my intentions to our goverment or do I just keep quiet and wait for them to catch up with me?
Will I become self employed and have to declare my earnings?
Once again thanks for your help.
That last paragraph is quite scary...
3 years ago I just left the country and never informed anyone, so I didn't register at all.
Afghanistan was 3 months on, 1 month off, so in that time I never went over the 90 days a year.
Since I started my current job back in May last year I have only been home for 7 weeks so far.
Do you really think I will end up with a big bill?
Does it make any difference where my money gets paid to, currently Abu Dhabi & in what currency?
I'm not planned to go home for a while yet so I suppose I should contact the HMRC via email?
Thank you Tony.
You have been a great help and I will look you up again in the future if I need futher help.