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, I am a UK resident years (I am originally from

Resolved Question:

,
I am a UK resident years (I am originally from Lithuania), and sold the investment funds in Lithuania. Should I pay the capital gain tax here in UK and how to do it?
Regards,
Laima
Submitted: 2 years ago.
Category: Tax
Expert:  Sam replied 2 years ago.
Laima
If you have sold the investment funds since you arrived to live in the UK, can I ask whether this money has been brought, or will be spent in the UK.
Have you suffered Lithuanian capital gains on the sales, and what sort of investment fund was it.
Do you have a tax record with the UK tax office, due to working or being self employed, and do you complete a tax return each year tax office?
THanks
Sam
Thanks
Sam
Customer: replied 2 years ago.

,

This investment fund was sold in Lithuania, during my residency in UK, on 2014-10 and it will probably remain in Lithuania, as I am planning to come back to the country in 2-3 years.

The investment fund invests globally in the shares - let me know if this information is not sufficient. The capital gain was from sales- I sold it because the market was dropping.

I am working here from April 2012, permanently employed so I am a tax payer, but do not complete a tax return each year.

Regards,

Laima

Expert:  Sam replied 2 years ago.
Laima
Thanks response
If you do not remit this money into the UK (or spend any of it) then as a non domicile individual you have the right to NOT be charged tax on this, by asking to be taxed under the remittance basis year.
Depending on the size of the gain depends on what other affects this may have in the UK. -
Tax if you’re non-domiciled
You don’t pay UK tax on your foreign income or gains if both:
they’re less than £2,000 in the tax year
you don’t bring them into the UK, eg transfer them to a UK bank account
If this applies to you, you don’t need to do anything.
Chapter 9 in HMRC’s guidance on ‘Residence, Domicile and the Remittance Basis’ explains the rules income or gains to the UK.
If your income is £2,000 or more
You must report foreign income or gains of £2,000 or more, or any money that you bring to the UK, in a Self Assessment tax return.
You can either:
pay UK tax on them - you may able to claim it back
claim the ‘remittance basis’
Claiming the remittance basis means you only pay UK tax on the income or gains you bring to the UK, but you:
lose tax-free allowances Tax and Capital Gains Tax (some ‘dual residents ’ may keep them)
pay an annual charge of £30,000 if you’ve been resident of the UK least 7 of the previous 9 tax years (this rises to £50,000 once you’ve been here 12 of the previous 14 years)
But you will still need to complete a self assessment tax return and I have added a link here you to register self assessment tax return.
https://online.hmrc.gov.uk/shortforms/form/SA1
Thanks
Sam
Customer: replied 2 years ago.

Thank you answer, however I still have a couple of questions.

If I choose to pay taxes or claim remittance basis will I need to fill in some other form than SA1?

Also what is the tax gains from investment funds here in UK?

Thanks

Laima

Expert:  Sam replied 2 years ago.

Yes, the SA1 just registers you assessment, which then will lead HMRC to issue you with the self assessment tax return to complete.
(You will need to complete this even if you do not claim the remittance basis)
And if you chose to pay capital gains in the UK, then the first £11,000 in exempt and the remaining gain is liable to 18% or 28% or a mix of both, and is based on what element of the basis rate band you have unused.
here in the UK you can earn up £41865 a year at the 20% rate - if your annual income was £30,000 then you would have £11865 unused basic rate band which would allow the first £11865 of the capital gain (after the £11,000 exemption) to be charged at 18% and any further gain then chargeable at 28%.
The any tax you suffer in Lithuania can be claimed to offset against the UK tax position as we have a tax treaty in place between the UK and Lithuania so you do not suffer tax twice on the same income.
Thanks
Sam
Customer: replied 2 years ago.

Thank you Sam. This is very useful. Just the last question if I chose to pay tax in Lithuania how can I prove that I paid it there? What documents are required?

Regards, Laima

Expert:  Sam replied 2 years ago.
Laima
Thanks further questions
You will have the appropriate documents from the investment that you draw funds from - and also one would assume, that the Lithuanian tax department - would provide you (and if required HMRC) with the proof required, then you merely enter the details of the tax suffered on the self assessment tax return.
Self Assessment works on the basis of accepting what you put on your tax return, then HMRC select random cases , to check their validity - its at this point evidence is asked for.
Let me know if you require any further assistance with this topic, but, it would be appreciated in the meantime, if you could rate the level of service provided.
Thanks
Sam
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