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bigduckontax
bigduckontax, Accountant
Category: Tax
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Experience:  FCCA FCMA CGMA ACIS
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Hi I am moved to UK in Nov 2006 and since then I am working

Customer Question

Hi
I am moved to UK in Nov 2006 and since then I am working in UK. I do not have any property or other investment in UK so far. Now I moving to Saudi Arabia along with my family around Mid November 2014. My new employer has told me that most of the employees receive around 20% of their salary in Saudi bank bank while the remaining is paid in their off shore bank account or bank account in their home country. My key questions are:
1) will I be taxed by HMRC if I receive a portion of my salary in UK bank account although I will be non-resident;
2) will I be taxed by HMRC if I receive portion of my salary in off shore bank account but then bring it to UK in future to buy some property;
3) am I required to pay tax on my Saudi salary for the rest of current tax year even though I am moving out of UK and will submit P90 to HMRC before I leave
Can you please advise me best option in view of my circumstances through which I can legally avoid UK tax while working in Saudi Arabia. It is a permanent job and I intend to work for a long period there. I am not concerned about tax on interest income as my I do not receive interest due to religious reasons.
Submitted: 2 years ago.
Category: Tax
Expert:  bigduckontax replied 2 years ago.
Hello, I'm Keith and happy to help you with your question.
Right, I understand your interest position. When you leave the UK send a form P85 [available on line] to your UK tax office. HMRC will then class you as non resident for the tax year after your departure date from the UK and also split the departure year into two portions, one part resident and one non resident.
You may certainly have some of all of your remuneration credited to an UK bank account, but you will still be classed as non resident after your departure to Saudi, but please remember to do the P85 procedure.
There would be no tax due on the movement of moneys you make to your bank account whilst you are non resident.
As I told you the tax year of departure will be split and therefore your Saudi emoluments will escape UK taxation as you are non resident for the second portion of the departure year.
To retain your non resident status you should be careful not to spend more than 91 days in the UK in any one tax year. These 91 days can be averaged out over four years, but the general consensus of expert opinion on this site is never to exceed the magic 91 days.
You may wish to consider continuing your National Insurance contributions to maintain your employment record. Many employers do this automatically for their expatriate employees. It is up to you whether or not you wish to do this, but it is a point to bear in mind.
There is no such form as a P90. There is, of course, a P60, which is an employer's summary at the year end of emoluments made and tax deducted. There is also the P45, the leaving notice. You should keep your P60 and the appropriate part of the P45.
I do hope I have been able to set your mind at rest over the matter of UK taxation liabilities on your Saudi income and your residence status.
bigduckontax, Accountant
Category: Tax
Satisfied Customers: 3375
Experience: FCCA FCMA CGMA ACIS
bigduckontax and 2 other Tax Specialists are ready to help you
Expert:  bigduckontax replied 2 years ago.
Thank you for your excellent support.
Expert:  bigduckontax replied 2 years ago.
Just an afterthought; the P85 also allows any overpaid UK Income Tax to be refunded to you on your leaving our shores so you don't have to worry about a separate claim.
Customer: replied 2 years ago.

Sorry didn't read NIC para in great details last night, appreciate if you can let me know benefits of paying NIC even if I am not in UK for couple of years.


 


Regards

Expert:  bigduckontax replied 2 years ago.
To use an old expression it keeps your card stamped. Your State Pension for example and entitlement to various other benefits often depends upon the number of contribution years you have to build up your entitlements. If you do not have the full 30 years for example your State Pension would be abated accordingly.

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