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bigduckontax, Accountant
Category: Tax
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, I will be moving to Abu Dhabi but will keep a company I

Customer Question

Hi, I will be moving to Abu Dhabi but will keep a company I have here. Would any earnings from that company ( through dividends) be subject to CGT or income tax. Also I will rent my house and any income from that will be classified as income tax but I can use my personal allowance. Am I right?
Thanks
Submitted: 2 years ago.
Category: Tax
Expert:  bigduckontax replied 2 years ago.
Hello, I'm Keith and happy to help you with your question; er not quite right!
First things, when you move to Abu Dhabi complete a Form P85 and send it to HMRC. This form is available on the net and can be filed on line. On receipt of this form HMRC will make you non resident from the next tax year and furthermore split the year of departure into two portions, one resident and one non resident.
Earnings from companies are not within the scope of Capital Gains Tax. Dividends are subject to Income Tax and will be grossed up to your marginal rate of tax. Normally dividends carry a notional tax credit of 10%, but must be grossed up if you are in higher rates tax.
The rental of your house must be declared on your Annual Self Assessment Tax Return for Income Tax irrespective of your status as a non resident. The Interest element of any mortgage is allowable against this. You retain your personnel Allowance, currently 10K. Here is Which data on costs which can be set against rentals:
'The most common types of expenses you can deduct are:
Water rates, council tax, gas and electricity
Maintenance and repairs to the property (but not improvements)
Contents insurance
Interest on a mortgage to buy the property
Costs of services, including the wages of gardeners and cleaners (as part of the rental agreement)
Letting agents' fees
Legal fees for lets of a year or less, or for renewing a lease of less than 50 years
Accountant’s fees
Rents, ground rents and service charges
Direct costs such as phone calls, stationery and advertising for new tenants
The expense should be incurred wholly and exclusively as a result of renting out your property.'
I do hope I have assisted you with your query. Most important, don't forget the P85 procedure, most important.
Customer: replied 2 years ago.

Thanks very much for very comprehensive answer. I do start new job on 1st of April. Will I have to split this year into 2? Also I do self assessment every year. Do I have to send P85 to HRMC before I go?

Expert:  bigduckontax replied 2 years ago.
It will happen automatically when you submit the P85, but I do accept that a departure date of 1 April 2015 will not have a very dramatic effect on the 14/15 tax year. As you are renting out you will have to continue with annual self assessment tax returns.
The P85 can be submitted at any time, there is no time limit, but it is always a good idea to keep on top of these things.
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Expert:  bigduckontax replied 2 years ago.
Thank you for your support.

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