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"Domicile of origin" definition: start learning
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Acquired by birth, normally domicile of father. Domicile - an individual's permanent home.
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'Domicile of dependency' definition: start learning
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Up to age of 16. If father changes domicile, individual follows suit.
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'Domicile of choice' condition: start learning
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Individual need to demonstrated severing all ties with UK (which might be unlikely if individual has child in the UK). Usually take place where an individual emigrates to another country.
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'Deemed domicile' conditions for I.T. and CGT purposes: 2 [2cz+3cz] +1 for IHT purposes: An individual who has been domiciled in the UK, moves abroad and makes another country his/her permanent home, retains his/her UK domicile for 3 years. start learning
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Long-term residents: UK resident for 15 of previous 20 tax years | unless not-UK resident in any tax year after 5 April 2017. 2nd option -formerly domiciled resident. An individual is deemed domiciled in a tax year if: Born in the UK | and has his domicile of origin in the UK | and is UK resident in that tax year [BOR].
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An individual will be resident in the tax year if he or she: 2 start learning
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does not meet one of the automatic non-UK residence tests and meets one of the automatic UK residence tests | or meets one or more of the sufficient ties tests. If an individual satisfies an automatic non-UK residence test and automatic UK residence test = non-UK resident.
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Automatic non-UK tests. An individual is the in UK in tax year less than: 3 start learning
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16 days | or 46 and no UK-resident in any of last 3 years | or 91 days and works full-time abroad. 16-46-91w
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Automatic UK residency test. An individual is the in UK in tax year at least: 3 start learning
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183 days in tax year, | or 30 days in tax year and only home is in the UK, | or 365 days continuously working full-time, some of which fall in the tax year. 183-30-365
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5 start learning
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Family| Accommodation consecutive-91| Work-40| Days in UK 90| Country FAW_DC Spouse, civil partner or minor child is UK resident. | House in UK available for at least 91 CONSECUTIVE days and has some use. | At least 40 days of work in UK. | Has spent more than 90 days in UK in 1 of 2 previous years. | Most time spent in UK.
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When considering residence status for sufficient ties what timespan is relevant? start learning
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An individual must be a resident within one of previous 3 tax years. If not previous resident - the contry tie (the last one) is not in consideration.
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Split year basis (SYB) can apply if an individual is... start learning
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UK-resident under automatic or sufficient ties test (Non-resident cannot apply and will be non-resident for the whole year). Accordingly, for the SYB to apply, the individual must be UK resident in the tax year under the automatic tests or the sufficient ties tests.
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Split Year Basis when LEAVING the UK applies in the current year if the individual: 4cz The way the SYB works depends on whether the individual is leaving the UK or arriving into the UK as follows. start learning
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UK-resident in C.Y. | and previous year | and is not UK resident in following year | and leaves the UK part way through the current tax year for one of 3 specified reasons*. *Begins working full-time abroad. | Accompanies partner working full-time abroad. | Ceases to have any UK home.
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Specified reasons for SYB when leaving UK: 3 start learning
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Begins working full-time abroad. | Accompanies partner working full-time abroad. | Ceases to have any UK home. At date start work abroad. | Later of date partner starts overseas work and joining partner. | Date cease to have a UK home.
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SYB. When leaving the UK, the overseas part starts at: 3 start learning
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At date start work abroad. | Later of date partner starts overseas work and joining partner. | Date cease to have a UK home.
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Split Year Basis when ARRIVING in the UK applies in the current year if the individual: 3cz start learning
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is not UK-resident in C.Y. | and previous year | and arrives in the UK part way through the current tax year for one of 4 reasons: Acquires a UK home. | Begins working in the UK for at least 365 consecutive days. | Ceases work abroad and returns to the UK. | Accompanies or later joins his partner in UK to continue to live with them.
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Specified reasons for SYB when arriving in the UK: 4 start learning
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Acquires a UK home. | Begins working in the UK for at least 365 consecutive days. | Ceases work abroad and returns to the UK. | Accompanies or later joins his partner in UK to continue to live with them. HWDP Date acquires UK home. | Date start work in UK. | Date individual stops working overseas. | Later of date partner stops overseas work and joins partner in UK.
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SYB. When arriving in the UK, the UK period starts at: 4 start learning
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Date acquires UK home. | Date start work in UK. | Date individual stops working overseas. | Later of date partner stops overseas work and joins partner in UK.
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Income tax general rules for non-resident-not-domiciled: 2 start learning
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Taxed on UK income only. | Personal allowance available against UK income for UK and EEA citizens. All income arising in the UK is always subject to UK income tax irrespective of individual's status. | A UK resident is always taxed on overseas income - the only issue is whether he is taxed on an arising or remittance basis.
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Overseas income taxation of UK-residents but non-UK domiciled: start learning
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taxable (Arising basis or Remittance basis).
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Resident but non-UK domiciled. Treatment if UNREMITTED overseas income and gains amounts up to £2000: # start learning
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PA and AEA available. | Overseas capital losses available. | Saving nil rate band and Dividend nil rate band are unavailable. | Remittance basis is automatic. | All income taxed as non-saving income (including dividends). POSRA Note: Remittance basis will still be available to deemed domiciled individuals whose unremitted overseas income ang gains are under £2,000.
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Resident but non-UK domiciled. Treatment if UNREMITTED overseas income and gains amounts at least £2000: # start learning
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Arising basis is automatic | but can elect for Remittance basis (decision made each year).| AEA and PA available.| Overseas losses allowable. ARAL If elect: Personal allowance is unavailable, | possible Remittance Basis Charge (RBC).
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Consequences of Remittance basis election: # start learning
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One election for both IT and CGT. | PA unavailable. | AEA unavailable. | Remittance Basis Charge possible*. OPAR
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Remittance Basis Charge (RBC) is levied if individual: 4 start learning
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Is not UK domiciled| is UK resident| has been resident for 7 out of last 9 years | and elects for the remittance basis to apply. Aged 18 years old or more | and has total unremitted income and gains over £2,000.
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3 start learning
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Always top-slice.| Separate calculation for each source of foreign income.| Take out the source with the highest rate of overseas tax first. TSH
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CGT liability for non-resident regardless of domicile status general rule: start learning
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No liability on any assets, unless trading in UK or UK property.
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CGT to UK-resident, but not domiciled general rules: 2 start learning
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UK gains - arising basis. | Non-UK gains - possible remittance basis. Note: Under the remittance basis, overseas income is only taxed in the UK when it is remitted, or brought into the UK. | It is only available to individuals who are NOT DOMICILED in the UK. | It is unavailable also for deemed domiciled!
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Lack of election for Remittance basis charge in context of overseas capital losses: start learning
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not allowable - now or ever
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Election for Remittance basis charge in context of overseas capital losses: 3 start learning
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Binding. | Irrevocable. | Overseas losses allowable.* BIO but subject to to complicated matching rules (not examinable).
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CGT liability of individual coming to the UK general rules: 2cz start learning
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Only taxed on gains made after becoming UK resident, | subject to domicile rules for overseas assets.
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CGT liability of individual leaving the UK general rules: 2cz start learning
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If UK-resident for 4 of last 7 years tax years before leaving the UK, he remains liable to CGT even though no longer UK-resident if absent from UK | for less than 5 years. [The temporary non-residence rules] Temporary absence in place.
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CGT liability of an individual whilst abroad: start learning
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Further position depends whether the individual returns within or after 5 years - The temporary non-residence rules if within 5 years.
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CGT liability of an individual if return within 5 years: 2cz start learning
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Individual is liable on disposals of all assets whilst abroad | if the asset was owned before leaving in the UK or disposals after the date of return.
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CGT liability of an individual if return after 5 years: start learning
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Individual is liable on disposals after the date of return only. No CGT on disposals whilst abroad, unless UK property.
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Non-UK resident individuals are subject to CGT on the disposal of UK property after... 2 [d a t e s] start learning
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Disposals of UK residential property after 5 April 2015. | Disposals of UK non-residential property* after 5 April 2019. [Use MV at 5 April 2019 as deemed cost (or elect to use actual cost instead). *for example agriculture land
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PPR for non-UK residents special rules for a periods of non-occupation: PPR is available as usual for periods of occupation and deemed occupation. start learning
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If individual, spouse or civil partner stays in the property for at least 90 nights in the year - whole tax year is treated as a period of occupation. | If did not stay in the property for at least 90 nights - whole tax year as a period of non-occupation. but final 9 months of ownership are exempt*. *as long as the property qualified as the individual’s main private residence at some point during the period of ownership.
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Allocation of AEA and capital losses against overseas gains tax computation treatment: start learning
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Allocated against UK gain first. Overseas gains treated as 'top slice' gain.
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Deemed domiciled definitions: 3 | p o z o r General rule: Non-UK domiciled is liable on UK assets only. start learning
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An individual who ceases to be UK domiciled remains deemed UK domiciled for IHT purposes for next 3 years.| Individual who has been resident in UK for at least 15 out of 20 years, and for at least 1 of last 4 years, ending with the tax year in question. An individual who was born in the UK, who is UK resident in the tax year and was UK resident for at least 1 of the previous 2 years.
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Overseas status. Liability to IHT is determined by... k e y p o i n t start learning
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by domiciled, not residency.
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Location of assets - Shares and securities: Location of any assets is relevant only to non-UK domiciled individuals. start learning
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Land and buildings - physical location. | Bank accounts - location of account.
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Location of assets - Chattels: start learning
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Location at time of transfer. Debtors - where the debtor resides.
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Location of assets - Life assurance policies: start learning
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Where proceeds are payable.
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Location of assets - Interest in a business: start learning
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Where the business in carried on.
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Individual leaving the UK is liable IHT on... assets for ... years after leaving UK (deemed UK domiciled). 2 start learning
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on worldwide assets | for 3 years after leaving UK (deemed UK domiciled).
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Individual leaving the UK if acquire a non-UK domicile of choice will only be liable on UK assets once... start learning
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once 3 years have elapsed. Individual leaving the UK is liable IHT on worldwide assets for 3 years after leaving UK (deemed UK domiciled).
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Individual coming to the UK if acquire a UK domicile of choice is liable on worldwide assets when... start learning
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when become UK domiciled.
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UK IHT on overseas assets formula: 2cz start learning
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Amount included in estate | × AER AIE | × AER
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start learning
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SYB applies automatically if conditions are satisfied; there is no claim to be made. | It is not possible to disapply the SYB.
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Double tax treaty might provide tax double tax relief by... or by... start learning
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double tax relief by exemption*; | double tax treaty by credit** *Gain or income is tax only in one country. | **The tax chargeable in one country to be deducted from the tax charged in the other.
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Is BPR available for overseas asset? start learning
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Yes, BPR is available on worldwide assets. [note that APR is available only for UK and EEA properties]
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