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Tax Returns to include more detailed questions for non resident and non domiciled tax payers

HMRC have re-vamped the supplementary pages to the 2007 Self Assessment Tax Return which relate to Non Resident and Non Domicile issues. The revised pages have appeared in draft form on the HMRC website

Residence

Previously the tax return asked simply for the number of days spent in the UK (excluding days of arrival and departure) in a particular period. The new pages, which will be sent out with tax returns in April, ask additional questions, namely:

  • The number of days attributed to exceptional circumstances.
  • How many separate occasions were you present in the UK in the year, and
  • How many workdays were spent in the UK

The recent Gaines Cooper case decided that days of arrival and departure should be included but HMRC subsequently announced that this would be a ‘one-off’.  However it seems clear from the revised questions that they are taking a keener interest in this area.

Domicile Outside The UK

Previously the form simply asked whether details regarding domicile had previously been submitted toHMRC and whether circumstances had changed. The revised form asks neither of these questions but instead asks:

  • Whether 2006/2007 is the first year that a claim to be domiciled outside the UK is being made
  • If the domicile has changed from a UK domicile of origin, on what date did it change
    Whether you were born in the UK but never domiciled here, and
  • If born outside the UK when you came to live here.

    It appears from the last two questions that HMRC are trying to identify second generation immigrants with domicile outside the UK and those who might be ‘deemed” UK domicile. The deemed domicile rule currently has no effect for capital gains tax or income tax ( with one exception – Pre owned assets) and applies only to inheritance tax purposes. Perhaps HMRC are trying to widen the net?

 

 

Date: 28th February, 2007
Author: Liz Cuthbertson

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