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UK TAX ADVICE SYDNEY
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More than 5 million Brits have emigrated over the last decade and Australia remains their top destination of choice
Latest reports estimate that nearly 1.3 million Brits are now living down under with Sydney being the most popular city. Expats moving to any new country will have a whole host of items on their to-do list and one of the items near the top of their list should be to obtain UK tax advice in Sydney.
Many UK clients do seek tax advice before making the move to Sydney and this is always the recommended approach!
However, reality dictates that most relocate to Sydney, sort out the most pressing practical issues first and then, once settled, think about their financial affairs, including their personal tax arrangements.
There can be a myriad of UK tax issues to consider following a move from the UK to Sydney. These can include:
- determining your tax residence status;
- considering where you will be treated as being domiciled for general law purposes;
- ensuring you obtain full tax relief for all tax deductible expense items;
- your ongoing tax liabilities (if any) in the UK;
- your obligation to file UK tax returns for the current and future tax years;
- timing the disposals of your UK assets, including any UK investment properties;
- dealing with any rental from your UK real estate (you should ensure you are receiving this gross with no UK tax deductions being applied, but you need to apply for the exemption); and
- the need for two Wills and the importance that an Australian Will and English Will should interact with each other and not be drafted by separate advisers in splendid (but very badly misplaced) isolation.
The last point often trips up many British expats in Sydney. Many assume that once tax residence has been taken up in Australia, then UK inheritance tax no longer applies to them.
However, this is incorrect.
The key consideration is whether or not the individual remains domiciled in the UK.
Domicile is actually a general law, and not a tax law, concept. It is used to determine the system of personal law (dealing with matters such as marriage, divorce and Wills) which should be applied to an individual who has connections with more than one country.
Broadly, an individual is treated as being domiciled in the country in which they have their permanent home (and usually by reference to where they wish to ultimately spend their final days).
Whilst an individual can be tax resident in more than one country, it is only possible for an individual to have one operative domicile at any given time.
If you retain your UK domicile, then UK inheritance tax is chargeable upon your worldwide assets at the rate of 40% (after all exemptions, allowances and reliefs) upon your death.
Nonetheless, even if you move your domicile to Australia, you will remain liable to UK inheritance tax for a further three years from acquiring your new Australian domicile and you will continue to be subject to UK inheritance tax on any UK assets.
There can be a multitude of UK tax issues to consider as a British expat living in Sydney and that's why you should seek UK tax advice in Sydney ideally before you relocate from the UK, but otherwise soon after your arrive in Australia and on an ongoing basis to ensure you minimise your overall tax exposure and claim the fullest tax deductions and reliefs available.
Newshams Tax Advisers in Sydney
Newshams Tax Advisers in Sydney are experts at providing cutting edge UK tax advice for British expats living in Sydney.