US relief for the remittance basis charge confirmed
Date: Monday 15th August, 2011
Author: Lisa Spearman
Profile: Lisa Spearman
It is reported that the remittance basis charge is accepted as being relievable against US tax. Since its introduction in 2008, it was unclear whether the remittance basis charge of £30,000 was creditable in the US meaning that many US taxpayers felt unable to claim the remittance basis in the UK at all.
It is reported that the remittance basis charge is accepted as being relievable against US tax. Since its introduction in 2008, it was unclear whether the remittance basis charge of £30,000 was creditable in the US meaning that many US taxpayers felt unable to claim the remittance basis in the UK at all. This will become even more important with the proposed increase in the charge to £50,000 after 12 years of UK residence to take effect from 6 April 2012. Going forward we should have some greater flexibility in how to arrange UK/US taxpayers affairs.
Lisa Spearman is a tax adviser and a partner at Mercer & Hole. The views given in this blog are personal to the author, if you would like to discuss the contents of this post with Lisa you can call her on 020 7353 1597. Email Lisa Spearman
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Keywords: 'US Relief for the Remittance Basis Charge' 'US Taxpayer' 'UK/US taxpayers affairs'
Please note that the opinions expressed in this blog represent the views of the author and not the views of Mercer & Hole.
Discussion and Comments
By Kurt R. on Friday 16th December, 2011
Thanks so much for this blog! As a US citizen considering coming to the UK as an Investor, I have found the posts and your guidance very helpful.
My question is in regards to Domicile and how having Indefinite Leave to Remain would affect my non-dom status.
After five years as an Investor, I can apply for ILR if I meet certain time conditions. If I do get ILR (e.g., “permanent residence”), will I lose my non-dom status and therefore lose the option to use Remiittance Basis for tax purposes? I do not plan on living in the UK indefinitely, returning to the USA in my later years.
Thank you again for the wonderful blog and giving me some of your thoughts on this complex question.
By Lisa Spearman on Friday 16th December, 2011
Hi Kurt thanks for the kind comments. Essentially immigration status does not affect your domicile where you have a clear intention to return to your home land. The ILR is a permission to stay rather than an indication that you will. If your domicile was in doubt for other reasons then it may be evidential but it is not a determinant. Let me know if we can help you more formally.
Lisa