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TonyTax
TonyTax, Tax Consultant
Category: Tax
Satisfied Customers: 15915
Experience:  Inc Tax, CGT, Corp Tax, IHT, VAT.
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I have questions on my tax return I need to file before the

Customer Question

I have questions on my tax return I need to file before the end of the year.
I am a fiscal resident in the UK and work for a company here in UK. Do personal allowances apply in my case? How do I check on the HMRC if this is already accounted for?
On the Capital Gains/losses I noticed there are capital allowances of 11.000 GBP for 2013/2014. My capital gains/losses refer to a fund and stock portfolio I have in a bank in Spain. I haven't declared that yet as I wanted to file it on my tax return here in the UK. Is that possible? Would I be able to save paying some tax from this allowance?
Submitted: 2 years ago.
Category: Tax
Expert:  TonyTax replied 2 years ago.

Hi.

Can you confirm what nationality you are please. How long have you lived in the UK?

Customer: replied 2 years ago.

My citizenship is Spanish. I have a National Insurance number here in the UK. Just arrived one year ago and need help on see how everything works

Expert:  TonyTax replied 2 years ago.
Thanks.

Leave this with me while I draft my answer. There is a fair amount to get through so please bear with me.
Customer: replied 2 years ago.

Ok. Thanks. Can I get this automated so that I receive you answer on my email? My email is *****@******.***

Thanks

Expert:  TonyTax replied 2 years ago.
You will get an email when I have posted my answer. I'm afraid that the answer won't be in the email. It will be here but you can go out and come back to read it later if you wish.
Customer: replied 2 years ago.

Ok thanks. I will wait for your answer.

Expert:  TonyTax replied 2 years ago.

Hi again.

So long as you don't have £2,000 or more of non UK income or gains which you choose to leave outside the UK by choosing to be taxed only your UK income and gains and non-UK income and gains you do bring to the UK (the remittance basis), you will be entitled to the personal allowance of £10,000 to use against your income and the annual Capital Gains Tax exemption of £11,000 to use against your capital gains. There are some circumstances where you will still qualify for the allowances even if you do use the remittance basis of tax assessment

The personal allowance makes the first £10,000 of your annual income tax free and the CGT exemption makes the first £11,000 of capital gains you make in a tax year tax free. You will get credit for tax paid in Spain against your UK tax liability on the same income.

Take a look at section 9 of RDR1 here for more information on the remittance basis of assessment. I don't want to bore you with unnecessary detail so put simply, if you choose to be taxed in the UK on all your worldwide income and gains (as a UK domiciled and UK resident individual would be) you will be treated exactly the same as far as personal and Capital Gains allowances are concerned as that UK domiciled and UK resident individual.

If you are employed as opposed to self-employed, you should have a tax code of 1,000L which is the basic personal allowance of £10,000 with the last 0 dropped and an L added. This is the tax code most employees have in the UK. You can call the tax office on the number here to have your tax code checked. It may be shown on your payslips and will be shown on the P60 which you get at the end of the tax year. Your employer will be able to tell you what tax code they are operating. Read about tax codes here.

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

Customer: replied 2 years ago.

Hi Tony,

Thanks for your answer.

Sorry for the delay replying back but I was expecting the answer on my other email account, *****@******.***

I don't quite understand the remittance base you are mentioning on the first paragraph. Maybe if I am a little bit more clear on my situation, that might clarify.

I got a job offer and started working in London in July 2013. Till then I was working in Spain. I have a portfolio of stocks and funds in my bank back in Spain. The reason why I haven't brought that to the UK is because it is costly to transfer the stocks from one bank to another. Now I am considering bringing all my wealth to my new banks in UK so I have two options: Sell the stocks/funds and incur in capital gains or bring the stocks (no capital gains). So, if I was to sell all my wealth back in Spain, and bring it to the UK, I will be incurring in capital gains. If the capital gain allowance is there, then for me it would be great. I just want to make sure I can profit from this capital gain allowance before I make the move. The value of the portfolio is higher than £2000, and comprises of US and European stocks.

So. Would I still apply for the capital gain allowance if I sell the stocks?

Thanks

Gustavo

Expert:  TonyTax replied 2 years ago.

If you sell the investments and bring the cash to the UK, the gains will be taxable in the UK but you will be able to use the annual CGT exemption against them. For the current tax year, this is £11,000 so if you make gains of, say £30,000, you will pay CGT in the UK on £19,000.

If the proceeds of all your disposals in a tax year are more than four times the annual CGT exemption (£44,000) or the net gains are more than the CGT annual exemption itself (£11,000) or both, then you will need to disclose them in a self-assessment tax return after the end of the tax year in which they are sold. Take a look under the heading "How to report a sale, disposal or gain" here for more information.

Customer: replied 2 years ago.

Thanks, ***** ***** what is the remittance charge? If I bring, lets suppose £ 50.000 to the UK from Spain. Will I have to pay for a remittance charge? How much is that? How does it work?

Expert:  TonyTax replied 2 years ago.

You only pay the remittance charge if you choose to be taxed on the remittance basis as I explained previously. In any event, it won't apply to you for any tax year until you have been resident in the UK for 7 of the previous 9 tax years (£30,000) or 12 of the previous 14 tax years (£50,000) and only if you choose to be taxed on the remittance basis for any tax year. See paragraph 9.29 onwards in RDR1 here.

Expert:  TonyTax replied 2 years ago.
RDR1 is here. The link in the previous post didn't work.
Customer: replied 2 years ago.

Tony,

I understand that the income tax year in the UK goes from April 6th 2013 to April 5th 2014.

During that period, I incurred in Capital losses but no capital gains. On my tax return file I must provide that information (capital losses) lets say for example £5000

If I will be selling my shares during the period between April 6th 2014 till April 5th 2015, I will be incurring in capital gains, let's say for example £20000

As I read somewhere, I can offset or carry capital losses from previous tax periods. So on my next tax return, Would I be able to file my losses and even have a annual Capital gain allawance?

Would the calculation be as follows:

Capital Gain 2014/2015: £20000

Unused capital losses 2013/2014: £5000

Capital Gains allowance 2014/2015: £11000

Taxable Capital gain for 2014/2015: £4000

Is this calculation correct? Would this be what I should be filing on my tax return before the end of 2015? (off course, assuming that I am a UK resident during 2014/2015 and liable on a arising basis)

Thanks

Expert:  TonyTax replied 2 years ago.

Your calculation looks fine. The capital gains pages for the 2014 tax return and the notes are here. The 2015 pages will be released after 5 April 2015.

You can carry forward net capital losses from one tax year to the next and use so much of them as you need to, to reduce your gains for the later year to the annual CGT exemption level. Any balance of losses would then be carried forward again.

In the same way that gains made before you came to the UK are not usually taxable in the UK, so any losses you incurred before you came to the UK will not normally be deductible from gains made after your arrival in the UK. See paragraph 6.60 on page 44 of RDR1 here.

TonyTax and other Tax Specialists are ready to help you
Customer: replied 2 years ago.

Hello Tony,

Sorry for my late reply but the last week was pretty busy.

Can I fill my tax return online? Is there a site in the HRMC where I can check the results like in a draft before submitting them?

Please let me know as I would like to do that myself.

Last question. What happen if I was to leave the UK by the end of this year? According the SRT, I will still be UK resident for the 2014-15 tax period so I will have to file the tax return here next year.

What happens afterwards? If I was to keep my investment in the uk, would I be able to file my tax here as non resident? Is that beneficial at all, providing I have most of my wealth in a portfolio of financial tools: Stocks, bonds ETF / Funds.

Thank you very very much for your help.

Expert:  TonyTax replied 2 years ago.
You can complete your return online and you can read about registering for self assessment and completing your return online here. You can review a draft return before you submit it and make changes if necessary. However, if you will be completing the residence, remittance pages, you cannot complete it online I'm afraid and will have to file a paper return.

If you leave the UK in 2014/15, you will probably qualify for split year treatment as you will probaly have for the tax year of your arrival. The completed resident remittance pages here will tell the tax office when you left the UK.

If you are no longer resident in the UK, you will only be taxable on UK source income such as property income. Many non-UK rsidents file UK tax returns. It depends on the circumstances of the individual and what UK income sources they have.
Customer: replied 2 years ago.

Thanks.

I will try to file my tax return online and get back to you if I have further questions.

All this tax planning is very important to be considered.

Well keep in touch.

Regards,

Gustavo

Expert:  TonyTax replied 2 years ago.
OK, thanks for letting me know.
Customer: replied 2 years ago.

Hi Tony,


Sorry to ask you. It is a brief question.


 


I need a certificate of residence. Do you know how I can get it? Is there a way to get it online?


 


I also tried registering for the self assessment. The web is requesting my Unique Taxpayer Reference (UTR) number. I have a tax reference and my National Insurance number, but I cant find my UTR. How can I get it? I tried using my tax reference, but it is denied by the web.


 


Thanks


 


 

Expert:  TonyTax replied 2 years ago.
You can apply online for a certificate of residence here.

You need a UTR before you can complete a self-assessment tax return. Complete the form here to get registered for self-assessment and to be issued with a UTR.

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