Simon Phelps
Personal & Family Wealth

Moving country will present new challenges as you enter a new tax regime. We will help you ensure that your move is as simple and tax-efficient as possible.

I am moving country

Below are some examples of the opportunities and challenges we respond to on behalf of wealth owners, their families and their other advisers.

I am moving to the UK: What planning do I need to do before I arrive?

Tax planning should look at both UK and country of origin rules

Our US client told us she was coming to work in the UK for several years.

First we looked at how the UK-US tax and treaty rules would apply to her, and her earnings. Then we advised her to set up non-UK accounts to hold funds that she could bring into the UK tax free, but that would also be US tax efficient. We also advised her to retire as trustee of US trusts to avoid them becoming liable for additional UK and US taxes.

A move to the UK needn’t mean tax problems

We helped our Eastern European client make a tax-efficient move to the UK. First we advised him to bring some funds into the UK before he became resident.

Then we helped structure his non-UK assets to deliver a tax-efficient flow of funds to the UK, setting up a suitable investment portfolio, and making sure that there was capital available to use in his ongoing business.

  • The UK non-dom tax regime encourages people to keep their money outside the UK, but timely planning can make sure a non-dom has a pot of money that can be used in the UK tax-free.

    Damian Bloom, Partner - Head of Private Client
  • When you or a family member move to another country, you need to consider not just your personal assets, but also trusts and other structures which you have established, or from which you can benefit.

    Sam Carver, Associate Director - Private Client

How much time can I spend in the UK before becoming UK tax resident?

Planning your UK visits under the statutory residence rules

Our non-UK client bought a home in the UK and stayed there a number of times a year, visiting her daughter who was studying in the UK. She was concerned she might become tax resident.

We explained that under the statutory resident rules, she could spend up to 120 nights in the UK each year without becoming UK resident: she was not working in the UK, her daughter was not a minor, and she had not spent any significant time in the UK in previous years.

Careful timing makes your pre-immigration tax-plan more effective

Our non-UK client accepted a job in the UK and he and his wife signed a lease on a London flat. They would clearly become UK tax residents.

We advised them to delay moving to the UK until the spring – after 5 April – so that we could put some tax planning in place in the tax year before they arrived.

What taxes will I have to pay if I do become resident?

Pre-arrival planning helps manage the tax impact of a move to the UK

Our wealthy European client wanted to manage the tax impact of his move to the UK.

We explained that he could prevent his non-UK income and gains from being taxed in the UK and worked with him on pre-arrival planning. For example, any capital gains – like those from selling a property or a business – realised before he came to the UK would not be liable for UK tax, even if brought into the UK.

Consider non-UK earnings before you move to the UK

Our client, a highly paid Italian executive, was moving to the UK.

We made sure that for the first three years only her earnings for UK duties (and not her earnings for duties carried on outside the UK) would be subject to UK tax. After three years this would only be possible if she had two separate, unrelated onshore and offshore employments.

  • Expats need to be alert to the proposed changes to the UK tax rules which take effect from April 2017. The draconian rules mean that an expat could find themselves paying UK income tax and capital gains tax and exposed to inheritance tax on their worldwide assets if they return to the UK, even temporarily.

    Damian Bloom, Partner Head of Private Client
  • UK income will always be in the UK tax net. On becoming UK resident UK gains fall in too. For a non-dom, planning often means making sure income and gains arise, and remain outside the UK.

    Damian Bloom, Partner - Head of Private Client

How do I avoid being taxed in both countries?

A tax-efficient move from Italy to the UK

Our Italian client was moving from Italy to the UK and wanted to make sure he wasn’t taxed in both countries. We planned and documented his exit from Italy and his arrival in the UK – obtaining the certificate of UK residency required by the Italian authorities.

We helped him realise gains on certain assets – without an Italian or UK charge – and set up a tax-efficient UK asset-holding structure.

Being the beneficiary of a trust can cause a headache in some countries

Our UK client, a beneficiary of an offshore trust, was moving to France to work.

French rules on trusts are rather draconian: both he and the trust would have faced significant tax charges. So we removed him as a beneficiary of the trust before he left the UK but made sure he could still have access to other family funds in the future.  We also made sure he didn’t suffer double tax on his earned and investment income.

I am buying a home in the UK. How should I own it? How should I fund it?

Tax questions on buying a high value London property

Our wealthy non-UK client wanted to buy a high value London home. We reviewed the tax implications and considered up-coming changes to taxes on owner-occupied residential property.

We advised that the best solution was to buy the property in her own name, and finance the acquisition to help mitigate the potential inheritance tax.

I want to become non-UK tax resident. How much time to do I need to spend outside the UK?

With careful planning you can be non-UK resident – even with significant ties to the UK

A UK client relocated to Singapore while his family stayed in the UK to avoid disrupting his children’s schooling.

We advised that under the statutory-residence test he does qualify as a non-UK resident despite his significant ties to the UK. This would be the case as long as he spends fewer than 91 days in the UK and fewer than 31 of these are working days.

The right jurisdiction for your tax situation

Our UK resident non-UK domiciled client was surprised by tax changes that mean she will be liable for UK tax on her worldwide income and gains from April 2017.

We looked carefully at her situation – she’s retired, with adult children and significant offshore investment income – and mapped out the tax impacts of moving to several alternative jurisdictions, either immediately or in a few years, with some interim planning. Her current shortlist includes Switzerland and the UAE.

  • If you come to or leave the UK part way through a tax year, “split year” treatment can be available, but only in limited circumstances.

    Simon Phelps, Partner - Private Client
  • The loss of the remittance basis for those non-doms who’ve been in the UK for 15 years, is causing a number of wealthy individuals to the leave the UK. The difficult question is not how to leave, but where to go.

    Tracey Neuman, Associate Director - Private Client

“Regulation can force banks to give incorrect information to tax authorities. Managing this is essential.”

Damian Bloom, Partner - Head of Private Client

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