08 April 2022
What do you know about Remittance Basis?
There has been a lot of media coverage recently concerning the wife of Chancellor Rishi Sunak, her tax affairs in the UK and just what is the Remittance Basis (RB) is all about.
RB probably isn't something that most people would be aware of, except for maybe recalling some heady tales of rock stars leaving the UK for tax reasons (or for fans of ‘The Hitchhikers Guide To The Galaxy’, they may recall the similar but sombre tale of Hotblack Desiato!).
So, here is our top five tit-bits on the RB:
- It applies to UK residents who are not domiciled in the UK
- It allows overseas income and gains to not be taxed in the UK
- That income or gain is taxed only if it is remitted to the UK
- If you claim RB for more than seven years, there is also a charge to pay
- After fifteen years in the UK, you can no longer use the RB in most cases
What we don't know as far as Mrs Sunak is concerned is whether anything has actually been remitted, and has she simply operated within the tax law as everyone else is expected to do?
Media reports aside, this does create something of a difficult position for Rishi Sunak – he has the power as Chancellor to change these rules if he wished, but should he? There are also some technical issues between the UK and India where the fifteen year rule can be ignored, which Rishi could also alter if he chose to. Interesting times!
If you are not domiciled in the UK but live here in Edinburgh, Scotland and would like to find out more about this issue, or if you have any other tax queries, why not get in touch?
