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Sam
Sam, Accountant
Category: Tax
Satisfied Customers: 13869
Experience:  26 HMRC expertise, PAYE, Self Assessment ,Residency, Rental Income, Capital Gains, CIS ask for Sam Tax
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I live in Egypt and rent my flat out in the UK I make

Resolved Question:

HI
I live in Egypt and rent my flat out in the UK I make around £800 profit a month. I also have an on line job a virtual assistant with a UK employer where I earn around £300 a month - I return to the UK for around a month every 3/4 months to take care of my flat do training courses with my employer etc
I am very confused by me tax status with these 2 incomes together I earn roughly £12,000 (before I start subtracting tax relief from my on line job) - I know I need to send a form so I can pay my own tax on my rental income (what tenant wants to pay tax on your behalf!) but is my salaried job UK taxable? if it is can I claim tax on air fare flying back to the uk and also the cost of my internet and electricity costs I inccur in Egypt in order to work on line in the same way I can in the UK and things like the cost of getting my phone or computer fixed in Egypt (so an Egyptian receipt) also do I pay the basic tax rate on the amount over the personal threshold of 20% as some calculations it seems I need to pay a lot more I don't actually mind paying a bit of tax but paying roughly £800 on a taxable amount of £2000 seems a bit extreme when I don't use UK services anymore!!
Submitted: 2 years ago.
Category: Tax
Expert:  Sam replied 2 years ago.

Hi

Thanks for your questions - I am Sam and I am one o th UkK tax exprts.

So I can advise you correctly, please provide the forllowing information

1) When did you leave the UK to live in Egypt

2) Are you a British Citizen

3) How many visits do you make back to the Uk each tax year (approx or if its been less than a full tax year since you left the UK, how many vdays you have visted since this time)

4) When do you plan to come back to the UK

5) Is your employer in the UK deducting tax from your salary

6) Did you advsie HMRC that you left the UK and had rental income and do you have agreement to have your rents paid gross under the non resident landlord scheme?

Thanks

Sam

Customer: replied 2 years ago.

Hi sorry lost my page so don't know if you got my response

ok so I have been going back wards and forwards to Egypt for a couple of years but officially started renting my flat for £1300 in April 4th 2014

I started my on line job in November 2014

I do not think my employer is deducting tax from my salary

I am a british citizen

in 2014/2015 tax year I made 2 visits to the uk for 1 month each - return again tonight for a month to re rent my flat - I then will be back in May to train with my employer and possible august for Nephews birthdays generally it is 3 visits a year for around a month

I did not advice the HMRCC re the rental income and do not have an agreement about me paying it and not my tenanat as I have just recently found out!

many thanks for your help and hi!!

Expert:  Sam replied 2 years ago.

Hi Lucy :)

Thanks for your response

So would you say that you officially left the UK on or around 04/04/2014 - to move there to live and work = as this is quite important to establish - as will affect the advise I offer you as you are clsoe to spending more than 90 days a year in the UK - which breaches the non residency rules at first glance (although there are then the statutsory residency tests to consider)

May I ask why you are coming home so frequently - and for so long at a time (as it may well be that you are not treated as NOT resident at all and will fully emian a UK taxpayer)

May I alaso ask (and I do not mean to be cheeky- why you moved to Egypt)

Do you have any other ties to the UK other than the property (that is rented out to tenants)

Thanks

Sam

Customer: replied 2 years ago.

You can ask whatever you want??

ok so the story is I went to Egypt for 3 months in Feb 2013 because I had been very sick for a number of years

when I was there I got very very well and was able to stop all my medication of which there was many

I then returned home and decided to go back and spend the summer there before returning to the uk to carry out my training as a psychotherapist

whilst at home over the summer of 2013 (which was may to july) I reached an agreement with college about restarting in October and went back to Egypt in July I then met someone whilst out there and continued to get very well from my apparent chronic incurable illness I have had since I was 15 - I continued to come back to the uk but at that time I wasn't working I was on benefits I stopped the benefits in November 2013 when it became apparent that I really was well. I was then living of savings and my partner was supporting me. so it was kind of a gradual move

I decided to rent my flat properly in April 2014 when my savings were beginning to run out! so in that sense that is when I officially moved there - however I still pay council tax in my name in my flat and all the bills are in my name - mainly as I was reluctant to break my ties with this country

I come home so frequently in order to see friends and family do training courses (in therapeutic things) I usually stay for that long due to return flight costs! for example I could return beginning of April but the flights are too expensive due to Easter Holidays the same with my trip last August the flights were too expensive to fly out

Expert:  Sam replied 2 years ago.

Hi Lucy

Thanks for the responses

Ok, thats great that gives me a feel for whats been happening wtih your movements to and from the UK, and its wonderful that you are feeling so well (I tend to think medication has much to do with creating additional physical and mental symptoms, but I am sure there are many GPs and consultants that would disagree with me - stating that the medicines are for the greater good!!

Ok, so what we ned to do is get you to complete form P85 - link here for this form which will advise HMRC that

1) You have left the UK to live and work - and have UK rental income - as the UK employment statted after this date - I would enclose a letter with this form dvisng the employment position too - so they can establish this income also (make sure that you advsiue you work online- and that all work is carrie don outside on the UK)

Link here form form P85

https://public-online.hmrc.gov.uk/lc/content/xfaforms/profiles/forms.html?contentRoot=repository:///Applications/PersonalTax_iForms/1.0/P85&template=P85.xdp

Let me know if you need the address to send this back to HMRC

2) Complete the claim for the Non Resident landlord scheme -

Link here https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/373943/nrl1i.pdf

This will allow you to have the rental income paid gross to you - and then so that HMRc can keep an eye on your residency posistion, they will arrange for you to complete a self assesment tax return after each 5th April, for you to record your income from employment (less expenses) rental income (less expenses) and also detail the time you have spent in and out of the UK.and claim for your personal tax allowances (which you are entitled to regardless of whether you are resident or Not resident in the UK for tax purposes- as you are a British citize

IF you spend more than 90 days a year in the UK (and any of them for work purposes) then you will eemian as treated as a resident of the Uk and rem***** *****able to UK tax on your total income.

If that is the case, then as things stand the first £10,000 income is tax free and the remindr liable to 20% tax - and you will pay any tax due by the following 31 st Jan

So - your first tax return will be filled in for the 2014/2015 tax year - and ant tax due pais to HMRc by 31/01/2016.

Let me know if you have any follow up questions, OR need the address for HMRc to send back the P85 - but it would be appreciated if you could rate the level of service I have peovided, and note that you can always come back to Just Answwer when its time to fill in the tax return if you need any furtehr help-

Thanks

Sam

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Customer: replied 2 years ago.

many thanks for this!!

i thought i lost my first response so re sent it - i am flying back to the uk now so ill look at this over the weekend and see if i have any additional questions!!

and yes by the end i was i definitley sure sicker due to the drugs than the actual disease itself - it is nearly impossible to get out of that merry go round whilst living in the UK and in the medical system. no ones fault just the way the medical system works and doctors are trained in a narrow way of looking at things

with very best wishes Sam and thanks!

Expert:  Sam replied 2 years ago.

Hi Lucy

You are very welocme and I shall be online on and off over the weekend - should youw ish to follow anything up, Have a safe flight back and be prepared to wrap up - its still a little chilly here in the UK compared to your wonderful tempretures !

Thanks

Sam

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