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bigduckontax
bigduckontax, Accountant
Category: Tax
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Experience:  FCCA FCMA CGMA ACIS
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I have been living in Colombia South America since February

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I have been living in Colombia South America since February 2015 on a temporary visa, but I work almost every day online as a virtual assistant/PA/transcriptionist/typist in the UK via the Internet for UK companied (but self-employed). I am paid monthly into my UK bank account. I am registered self-employed with the Inland Revenue and have submitted and paid annual self-assessment tax returns each year online for the last two years 2015-2016 and 2016-2017. I have been on a temporary visa until now and have always thought I would more than likely be returning to the UK permanently each year, also returning to the UK and spending up to 35 days per year in the UK.In February 2018 I will most likely be given a permanent indefinite residency visa in Colombia. I would like to know if I am considered resident or non-resident for self-assessment tax purposes? I would also like know, if I am classed as non-resident for tax, whether I could claim back any National Insurance contributions I have made over the last two years? I would also like to know, if I am given residency here in February and I choose to stay here indefinitely, whether I will have to continue to pay National Insurance contributions in the future?Many thanks for your help. Sorry for the complex question!
Customer: replied 4 months ago.
I have visited my parents in the UK each calendar for approximately 33-40 days. I have a home in the UK (my parents' home) which although not in my name, is available for me to use and stay in when I am there. My work is entirely self-employed as a virtual assistant / typist working online for UK companies which ask their workers to register as self-employed, but who accept typists based in any part of the world with English as their main language. Really appreciate your help regarding my residency status and self-employment. Can I continue to process my SA tax return online after I am given residency here in February?

Hello, I am one of the experts on Just Answer and pleased to be able to help you with your question.

When you left the UK did you complete a Form P85 and send it to your tax office?

Customer: replied 4 months ago.
No I didn't unfortunately as I was not aware of the form. I just continued to fill out my self-assessment return online and pay tax and national insurance online each year.
Customer: replied 4 months ago.
I'd prefer a written answer if possible - sorry! Thank you.

You should complete a Form P85 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 classify you as non resident. Once so classified you can spend up to 90 days in the UK in any one tax year without breaching your non resident status. As a non resident you have no liability to UK taxation save for local income eg pensions or rentals. You can continue to make NI contributions on a voluntary basis. I regret that you have a lot of UK tax return errors to unscramble and will not find HMRC very receptive to making refunds.

You will be subject to Comumbian tax on this income. Fortunately, there is a Double Taxation Treaty between the UK and Columbia which precludes the same income stream being taxed in both jurisdictions. Thus the tax paid in the UK will be allowed as a tax credit against any Columb***** *****ability which will help getting round the HMRC for a refund.

I think we are moving forward.

Customer: replied 4 months ago.
Thank you very much. I really appreciate your answer and time.If I fill out the P85 now do I put today's date? Or back-date it to the date I moved here in February 2015, despite having visited the UK for over a month in 2016 and also 2017.I had also assumed that since I am working online for UK companies based in the UK and being paid into a UK account, I would have to pay the the tax to HMRC.Once recognised as non-resident by HMRC will I then pay my taxes in Colombia and not in the UK?

Backdate it to your original departure date. Don't worry it happens every day. You have 90 days cover for UK visits every tax year once classified as non resident.

Correct, you should be paying tax in Columbia not the UK. The Treaty should cover your liabilities to date with any luck.

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Customer: replied 4 months ago.
Thank you very much for your help at this late hour! 5 stars coming up !

Thank you for your support.

It's not a late hour for me, I am responding from a country 7 hours ahead of GMT!