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bigduckontax
bigduckontax, Accountant
Category: Tax
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Experience:  FCCA FCMA CGMA ACIS
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Dear Sirs, I have been recently issued with a PPN/accelerated

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Dear Sirs,
I have been recently issued with a PPN/accelerated payment demand in regard to a film partnership investment (Ingenious) with a payment date of 1st April. The payment demand is for 4 years and in total is for £100k. I have not been a U.K resident for some 5/6 years now and am a tax resident in Portugal where I live. I have no ties or assets in the U.K. and no assets or funds in Portugal and cannot pay to HMRC this payment demand. I am 69 years old and retired with 3 pensions giving me an annual income of £105K.
Can you tell me the powers HMRC have to recover the tax due and what % of my pensions they could insist on me to pay to them per year as a part repayment?
Many thanks,
Dick Francis.
Submitted: 1 year ago.
Category: Tax
Expert:  bigduckontax replied 1 year ago.
Hello, I am Keith, one of the experts on Just Answer, and pleased to be able to help you with your question. Firstly, when you moved to Portugal did you send HMRC a Form P85? If you did not you should do so immediately. Fortunately there is no time limit as to its submission, it is available on the net and can be filed on line. On receipt HMRC will class you as non resident for tax purposes from your date of departure. PPNs appear to apply to check the tax arrangements of public employees. Accelerated payment demands are issued where a tax avoidance scheme has been entered into. Write a letter to HMRC explaining that you have neither a public appointment, have not used a tax avoidance scheme and that your income stems from UK pensions taxed at source. That should put HMRC back in their box. HMRC can seek to recover UK Income Tax owing with no time limitation. They can use the usual debt recovery procedures and these days tend to sell the debt on to a debt collection company. Since HMRC issue thousands of incorrect demands every year their post bag tends to be full which perhaps explains that Department's inability to answer the telephone or deal promptly with correspondence. I do hope that you find my reply of assistance.
Customer: replied 1 year ago.
Hi Keith,I left the U.K. as I said 5/6 years ago and because I did not become a tax resident any where else (as I was spending time in different countries) for the first 2/3 years I had to continue to submit and pay my taxes to HMRC (even though I was not a resident spending maybe only 50/60 days at most in the U.K. in any of those years). I ceased to become a tax resident in the U.K from April 2013 and have since submited my tax return in Portugal as a resident. I did complete and submit to HMRC a P85 at the time which HMRC confirmed.All my pensions are paid from a U.K source which are 2 private pensions ( both of which are Annuities and total circa £95K p.a) along with my state pension of Circa £10k p.a .I wrote a letter of appeal against the original PPN's demanded, but this appeal was rejected by HMRC in mid March 2016.HMRC are now asking me to provide them with my income and expenditure details as well as my worldwide assets (of which there is only one which is a 50% share in a house in Spain which if it could be sold (given the poor state of the market and the fact that the property is not as yet fully legal) would maybe generate (after paying the bank mortgage back and the selling and legal fees) maybe in total would leave a cash sum of maybe Euro 75/100K at best. My question is as I understand it HMRC cannot touch my actual pension pots but they might be able to ask or take a percentage/amount of my pensions which amount to £9000 net a month. I currently rent a property in Portugal and live there but are unable at this moment in time to realistically sell the house in Spain and realise my 50% share of the net value of the property.So can and would HMRC in your view take legal action to force the sale of the property in Spain even though I am a resident a Portugal and my wife is a UK resident?
Do HMRC need to undertake legal action against me in order to make a deduction against my monthly pensions given that I am a tax resident in Portugal.
If they can take a deduction against my pension payments what is the maximum that they could take after my ongoing living expenses (net income after bills).
Can they touch or take a charge on my pension pots.Sorry to be so long winded but hope this gives you the background as to where I am and the dilemma I find myself in.Regards ***** *****
Expert:  bigduckontax replied 1 year ago.
Submit a P85 immediately to correct a possible incorrect classification if the one you originally sent was after the 2/3 years of wanderings. Once classified as non resident you can spend up to 91 days in the UK in any one tax year without breaching your non resident status. It is normal for pensions to be taxed in country of origin, usually relying on Double Taxation Treaties to preclude the same income being taxed in both jurisdictions. Is this PPN accurate, or an assumption of the profits HMRC think you will derive from from the film venture. Remember some very famous films actually made losses of millions of dollars. HMRC are always keen to make assumptions, in my experience invariably wrong and always in favour of the Revenue. Unfortunately the film business had been a fruitful area of tax avoidance. So if their figures are wrong then challenge them again. HMRC would need to obtain a court order to arrest your pensions. Having regard to your location they may well feel the game not worth the candle.
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Customer: replied 1 year ago.
Morning Keith,Yes, it might be very helpful for me to have a telephone chat with you in regard to the issues/questions I raised with you you in my earlier in my last email to you.Dick.
Expert:  bigduckontax replied 1 year ago.
Thank you for your support.
Expert:  bigduckontax replied 1 year ago.
Dick Please read here about attachment of earnings orders: https://www.citizensadvice.org.uk/debt-and-money/action-your-creditor-can-take/creditor-takes-money-from-your-wages/ I do hope it helps Keith