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More dangers for Ex-pats

Following the Gaines-Cooper case, there may be trouble in store for those who claim non-UK residence based on the number of days spent in the UK. PriceWaterhouseCooper (PwC) have highlighted that the a re-write of existing tax rules, which are due to come in effect on 6 April 2007, has made what they refer to as “significant changes” to the existing rules.

The re-write may affect taxpayers who come to the UK for a temporary purpose and those leaving the UK for occasional residence abroad. According to PwC:

“Under the existing legislation in s334 of ICTA 1988, an individual who is a Commonwealth citizen, or citizen of the Republic of Ireland, who leaves the UK for the purpose of occasional residence abroad only, is taxed if he had remained resident in the UK. The Income Tax Bill will extend this rule to anyone who, prior to leaving the UK, has been both resident and ordinarily resident. Potentially this change will bring significant numbers of expatriates, for example from mainland Europe or the US, within the scope of the rule for the first time”.




Date: 7th March, 2007
Author: Liz Cuthbertson


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