UK tax liabilities
Aaaargh! I want to scream!!!!!
I've just been on the phone to the tax office.
I read on their website that for a person not to have any UK tax liability, they must be residing/working abroad for a whole tax year (from 6th April to 5th April - although you are permitted to spend a certain number of days in the UK).
What happens if a person starts a job in Qatar a few weeks after the start of the tax year?
Does that mean that there will be a liability to pay tax on the annual income paid in QAR?
I understood salaries in Qatar were supposed to be tax free. But it makes the salary much less attractive if I'm going to be taxed on it back home in the UK.
I couldn't get any sense out of the stupid idiot I just spoke to on the phone at the tax office. When I said that their website clearly says a person must be out of the UK for a whole tax year, she said that she didn't know what I was looking at (er, duh! *your* website, your information, your tax rules!) but it depended on the number of days a person lived in the UK.
The information she gave me over the phone contradicts the information on the website.
Can any Brit please tell me what the actual score is? I'm really confused now.
Thanks
I am a UK Expat who has now been abroad for the past 9 years. As long as you physically leave the UK by April 5th you would have to remain abroad until April 4th 2008 to pay NO UK tax at all on income originated from Qatar. If you come after this date then you will have to remain abroad until April '09 to have no tax liability. You continue to have tax liabilities on income earned onshore in the UK even though you are non-resident.
I am loathe to put my contact details on here but have been through this very same process with my accountant for the past few years. If you would like me to talk you through it please message me and I will pass you my contact details.
Good luck.
Sorry, maybe I confused things. To NOT pay any tax, you need to be out of the UK for a full tax year.
For example:
If you arrive in May 2006, you will need to stay in Qatar for a full tax year - April to April.
So, in this case, your 'tax year' would start April 2007, and end April 2008.
If you go back into the UK tax system earlier than April 2008, and you will be liable for tax on your Qatar earnings.
You are allowed to spend up to, and including, 91 days per tax year in the UK.
It's worth consulting the designated department at the UK Inland Revenue - which is called the Centre for Non Residents. They are much more clear and helpful than the poor sod on the general helpline!
Let me know if you need more advice.
According to my accountant - Yes.
You need to stay out of the UK (barring the permitted visiting days) for a FULL TAX year
Andyscrabble: I'm a bit confused.
When you say: "In short, you have to cover that full designated tax year."
Do you mean that if I arrive in Doha some time in April (after 6th) or perhaps early May, that I will need to pay tax to the UK tax authorities on *all* my Qatar earnings throughout the whole of the tax year?
Thanks
I used to work in UK and out of UK, and currently out. I left UK in 2002, though not a brit but no exception when it comes to tax.
You are liable to pay tax, but the real question is how much.
You only pay tax on the total income you earn in UK for the tax year. So when worked in UK for a few weeks before going abroad, you are liable for the tax of that few weeks you have worked in the UK
You also have a personal allowance for the tax year. Even if you work only a few weeks for the financial year, you are entitled to the full personal allowance for that year.
In short,
Say you work in UK for a few weeks before you leave , you earn 6000.
personal allowance = 4000 (dont know the exact figure now)
you are only liable to tax on 2000.
If tax rate is 20%, you pay only 400- if you have paid more than this , you can claim for a rebate.. I remember signing something which states that I wont be earning anything that is liable to UK income tax for the rest of the tax year when i made this claim. (When I started work, I used to time my start date and end date of my employment contract correctly so I can maximise this allowance)
If you have other investments etc, then it gets trickier. Say you rent out your property, and have income via savings/shares etc.- you are still liable for UK income tax on those income. In which case i suggest a financial consultant.
It is very tricky, Serendipity. But here goes:
You are right that you have to spend a full tax year (6 April to 5 April out of the UK to claim tax free earnings.
So if you got here on, for example, 13th April 2006, your tax year wouldn't start until 6 April 2007. Then you would have to stay in Qatar til 5 April 2008.
In short, you have to cover that full designated tax year.
This subject has been covered in detail on another thread.
There have been threats to impose tax on UK expatriates for a number of years but so far nothing has happened.
I suggest you do a search for the previous thread.
http://www.qatarliving.com/search/node/%22UK+tax%22
This will lead you to the various threads