Fiscal Nomad Lifestyle Setup / Follow Up:

Question:

Thanks for confirming re: Singapore, and also for the suggestion on even further simplification. I find this interesting. My introduction to the offshore subject was via more "underground" authors, which to be honest are mostly B.S. and overly paranoid. So this simple observation is definitely appreciated.

A couple of questions to clarify:

1. With the "UK Bank Account + Malta Residency" setup, is my only tax liability income remitted to Malta?

2. Does maintaining the UK bank account not make establishing UK Non-Residency more confusing and vague? Or would the Malta Residency take care of this?

My initial thoughts would be that maintaining the UK account (and also therefore some kind of address) would make things potentially confusing, and open to misinterpretation. From your answer however, it would seem that the Malta residency (especially in light of the tax treaty relationship) would make my status very clear and unambiguous. Is this correct?

Answer:

In answer to your questions:

1. With the "UK Bank Account + Malta Residency" setup, is my only tax liability income remitted to Malta?

Clearly you'd need to take Maltese tax advice but yes you should only be taxed on the remittance basis. There are also routes to bring cash into Malta as capital free of local tax (as there is no CGT). You wouldn't have a UK tax charge if there is no UK trade.

2. Does maintaining the UK bank account not make establishing UK Non-Residency more confusing and vague? Or would the Malta Residency take care of this?

No, having a UK bank account isn't a problem. It is the location of the business (ie where the duties are carried out & the revenue generated) that is of key importance not the location of the customers or where the cash is paid.

Establishing non residence is perfectly possible whilst still receiving money into a UK account. Many individuals continue to receive cash into UK accounts after leaving the UK and can still establish non residence.

My initial thoughts would be that maintaining the UK account (and also therefore some kind of address) would make things potentially confusing, and open to misinterpretation. From your answer however, it would seem that the Malta residency (especially in light of the tax treaty relationship) would make my status very clear and unambiguous. Is this correct?

Yes you can have a forwarding address for mail etc in the UK for the UK bank account. You'd need to be clear that any invoices were from overseas and the duties were carried out overseas. The tax treaty relationship would certainly assist in ensuring there was no charge to UK tax (see: http://www.hmrc.gov.uk/manuals/dtmanual/DT12966.14.htm)

You may find this article of interest:

When can an overseas internet operator be within the scope of UK tax?

About the Author

He worked in Ernst & Youngs Entrepreneurial Services department for a number of years before setting up his own tax planning practice. He is now a full time tax author.

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