Different tax laws apply to foreign nationals living and working in the UK, just as they would apply to UK citizens living and working abroad.
Because of this it is important that the right tax rules are applied to make sure you are not paying too much or too little.
At Milsted Langdon, our international tax advisers in Bath, Bristol, London, Taunton and Yeovil can help non-UK domiciled individuals make sure they keep on top of the rules and don’t end up out of pocket by paying more than they should or face tax invoices for not paying enough.
Double Taxation Treaties
If you have income from a source in one country but are classed as being resident in another, then you could be liable for tax in both countries under their individual tax laws. This is known as ‘double taxation’.
However, the UK has in place double taxation treaties with more than 100 different countries. Depending on how the treaty is worded, these are known as either a double taxation agreement or a double taxation convention.
If you are resident of a country with which the UK has such a treaty, then you may be able to claim exemption or partial relief from UK tax on certain types of UK income, such as interest, royalties, pensions or dividends from UK companies.
Relief is not automatic and anyone wanting to benefit must first apply to HM Revenue & Customs (HMRC).
Applications for relief under a treaty can be made by individuals, corporations or other concerns such as partnerships or trusts, but only the overseas person receiving the income can be make a valid claim.
If you think you may be entitled to make an application, then it is best to seek professional advice. Milsted Langdon’s international tax experts can advise you on whether you are eligible and help you with your application. We can also ensure you make the most from any double taxation treaty in place between the UK and your country of residence.