Expats Hit by New Residency Restrictions

The new HMRC Residence, Domicile and Remittance Bill announced on the 1st of April has introduced several new wide ranging regulations.

London, UK (Pryce Warner International) April 6th, 2011 - The most significant change for expats is that their overseas residency may be challenged if they spend more than ten days working in the U.K. over the course of a year.

This means a great many expats who consider themselves resident outside the U.K. may now find their residency challenged and be required to pay U.K. income tax.

For those working in countries with minimal taxation like the UAE or Singapore, this change is especially damaging. It is now possible that attending a few meetings in the U.K. over the course of a year could double their tax bill.

Previously, expats were able to spend an average of 90 days in the U.K. without the risk of their residency being challenged and while this law has been subject to review for some time, the decision to reduce the number to a mere ten days has been met with much criticism.

Though the HMRC claims this new law is designed to stop people fraudulently claiming foreign residency it will more than likely affect many who have moved with no ill intentions and lead to reduced foreign business in the U.K.

Expats may also be affected by new changes to the taxation of their pensions. In line with the disguised remuneration rules, the HMRC announced changes to Extra Statutory Concession A10.

If you are an expat and are concerned about how these changes may affect you, visit www.prycewarner.com for more information and details on how to contact one of our experienced advisors.

David Harra, a Senior Market & Investment Analyst with Pryce Warner International, a financial services company for the expat community, commented: “While it is beneficial for expats to know the exact amount of time they are able to work in the U.K. without risking their residency status, the ten day limit is worryingly low. This will no doubt cause a lot of needless trouble for many people who changed residency with only the best of intentions.

Pryce Warner International Group provide International Asset & Investment Management, Independent Financial Advice & QROPS Overseas Pensions.

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By: Aneil Fatania
Financial Editor
Pryce Warner International Group
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