Non UK domciliaries and remittances

There were no changes to the tax benefits available to non UK domiciliaries in the recent budget. This is not surprising and if there was a change expected this is the kind of issue that is likely to be subject to a lengthly consultation period beforehand (although you could rightly say this hasn't stopped them before). This is an issue though that has grabbed the attention of the newspapers. You can't help but find an article on this if you flick through the broadsheets, although they're often wrong. For example one article I saw in a newspaper last week stated that foreigners avoid paying tax on their overseas income...and that was it. No further details to reflect the true position. Maybe it's because I'm an accountant, but these kind of statements irritate me. Non Domicilairies aren't exempt from tax on overseas income - they're just exempt so long as they don't bring it into the UK. If they bring it in they're then taxed in the UK on it. Having said this for many non domiciliaries whether they bring cash into the UK or not is irrelevant. They'll probably have suffered tax overseas on the income or gains, and when they remit it they'll offset any overseas tax against the UK tax. The UK rates, although hard to believe are still pretty low, particularly when you take account of all the reliefs (eg the UK effective 10% CGT rate for trading assets). So for many when they remit income or proceeds/gains to the UK there may well not be any UK tax due in any case, or even if there is it will be significantly reduced. The main case when this doesn't apply is where assets are held in an overseas tax haven. It's on this occasion that catching overseas income and gains is important for the Revenue. The rules for classing income as being remitted are therefore very wide (covering things like spending in the UK on an overseas credit card which is cleared from overseas funds). That's why it's important for Non Dom's to ensure they clearly segregate income and gains and capital accumulated before they became UK resident. See this article for more on non UK domiciliaries: Making the most of the non UK domiciliary rules