Six year-end tax issues for non-doms in the UK
By Kirsten Hastings, 31 Jan 17
The approaching tax year-end applies equally to those born in the UK and to foreign expats living there. This year, expats may have even more to consider given the new non-dom rules coming into force from 6 April 2017, warns Old Mutual Wealth’s financial planning expert, Rachael Griffin.
Any UK property held through an offshore company structure should be reviewed
From 6 April 2017, foreign expats investing in UK property through an overseas corporate structure or trust, known as ‘enveloping’, will no longer be excluded from UK IHT.
HMRC will essentially ‘see through’ the corporate structure, making them ineffective from an IHT planning perspective.
It might make sense for these structures to be unwound as they will no longer be effective and may not justify the ongoing fees involved.
If individuals are concerned about their exposure to UK IHT, they may benefit from some estate planning to help ensure beneficiaries have enough money to pay any IHT liability.
Maximise ISA and pension contributions
Foreign expats living and working in the UK (paying UK income tax) are able to invest in ISAs and pensions and benefit from tax efficient investing in the same way as those who were born in the UK.
This can help their investments grow tax efficiently while they are in the UK, and they can continue to hold the investment when overseas, though the tax advantages may be limited.
Tags: IHT | Non Doms | Old Mutual
