Do I have to pay UK tax if I move abroad?
Does Moving Abroad Mean I Stop Paying UK Tax?
Not necessarily.
UK citizens living abroad may be subject to taxation depending on their residence status.
The UK taxation rules apply to all UK residents who spend more than 183 days in the UK or maintain strong ties with the UK, even if they move abroad – they are taxed on their income from activities in the UK as well as abroad.
What challenges may UK citizens face when moving to live abroad?
UK citizens may face challenges with tax submissions. Many issues stem from the inability to file online on the HMRC gateway and the complexity in declaring non-resident status.
If you have recently moved or are planning to move abroad, it is advisable to appoint a representative in the UK to handle correspondence and the SA online submission on your behalf.
From abroad, you will still be able to submit your SA tax return on your own; however, only in a paper form and together with the SA109 (Residence, Remittance Basis) supplementary pages, or use commercial, HMRC-recognized software still offered by some providers free of charge.
Important to Remember:
Paper submissions are subject to earlier deadlines (Midnight on 31 October and not 31 January as with the online submission)
Missing a deadline incurs automatic penalties even if you do not owe any tax.
Double Taxation Agreements Can Help
The UK has signed Double Taxation Agreements (DTAs) that guarantee that, once you have looked after all your matters, you will not be double-taxed.
It may apply to pensioners who move abroad and have private pensions that are subject to tax in the country where they reside. Whilst the UK State Pension and most civil pensions are generally taxable only in the UK, private pensions must go through official bureaucratic processes to avoid double taxation, which can be challenging.
As the matter is complex, it is advisable to seek the help of an accounting professional.
Form P85
Those who plan to leave the UK and work abroad are advised to complete the P85 form to inform HMRC of their permanent move. This option is preferred over going through the SA Tax Return route.
Without starting the P85 process, HRMC is unaware that a UK citizen has left the country, and it may take several months for the system to process the information and update their tax codes, delaying repayment of any overpaid tax.
A trusted accounting professional acting on your behalf may be able to check your tax code and ensure you have not overpaid and receive a prompt tax refund.
By receiving all your mail from the UK, the tax assistant will be able to act promptly on your behalf in response to any correspondence from HMRC, ensuring compliance and fairness.
UK tax will also be due from:
Non-Residents with UK-generated income – for example, working in the UK, having business in the UK, renting properties, or income from a UK Pension (exceptions apply)- are subject to taxation in the UK.
Rental income is already legally taxed by the Property Management Companies under NRLS – to receive full income (pensioners who, while living abroad, still submit their SA), they need to apply to HMRC for gross payment approval.
Temporary, Non-Residents who leave the UK and return within 5 years are subject to retroactive UK taxation for the income and capital gains during the period they were away (under special anti-avoidance rules).
If the subject interests you, you can read more on the HMRC website:
Tax- right- retire- abroad- return- to- UK
Check: How can I request a refund for overpaid taxes abroad?
Do I have to pay UK tax if I move abroad? - Your Tax Assistant
