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Good news for non UK Resident Individuals – The Personal Allowance lives on!


Alan Collett

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Tucked away in the UK Chancellor’s Autumn Statement of last week is some festive cheer – the continued availability of the UK personal allowance for non-UK resident individuals until April 2017 at least.

 

What is more, the UK personal allowance will increase to £10,600 from the 6th of April, 2015.

 

As some will know, there has been an ongoing consultative exercise by the UK Government into the withdrawal of the UK personal allowance for non-UK resident individuals. This would have impacted most those persons with UK income that is not also taxable in the country in which they are residing.

 

It would also have opened up additional compliance obligations for those non-UK residents who presently do not complete a UK personal income tax return each year. For example, HM Revenue is often happy to allow non-UK residents with UK rental property to not complete an annual tax return where the net rental income is less than the personal allowance.

 

The detailed commentary from the UK Government in the 2014 Autumn Statement reads as follows:

 

Restricting entitlement to the personal allowance for non-residents – At Budget 2014 the government launched a consultation on whether or not to restrict the Income Tax personal allowance for non-residents. Whilst the government believes there is a strong rationale for doing this, it recognises it is a complex change for both employers and individuals who may be affected. The government will continue to discuss implementation of this change with stakeholders. Should the government decide to proceed, a more detailed consultation will be undertaken. No change will come into effect before April 2017.

 

Best regards.

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  • 3 weeks later...

Yes, that's a reasonable conclusion to reach - save that many in receipt of UK rental income still have to complete a UK tax return for compliance purposes.

 

The main issue for such people is the CGT charge coming in from the start of the 2015/16 UK tax year.

 

Best regards.

Edited by Alan Collett
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