HMRC Special Treatment For Expats Stuck In The UK

HMRC has issued advice to British expatriates stuck in the UK due to coronavirus over tax residence rules.

HMRC will allow special treatment to be given to expatriates that face risking their non-residence tax status through being stuck in the UK longer than anticipated.

Tax does have to be taxing.

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Restriction of Non Residents' Personal Allowances

The hard up Treasury is planning more tax raids, this time on British expats who have an income in the UK (eg from renting out property).

Under plans, first mooted by Osborne in the March Budget, expats will be denied the right of the £10K personal allowance.

The rationale for this being that it would bring the UK tax system into line with the US, Canada and much of the EU.

The reality being that the state is broke and is desperate for cash.

The Telegraph notes that at the moment this might affect up to 400,000 people, but not the 1.2M retirees who are counted as UK residents for tax purposes (because they spend half the year in the UK, or because they are only taxable in the country of residence).

However, there will need to be exceptions inserted into any legislation; otherwise former civil servants, NHS workers and council officials living overseas will pay more tax as may British diplomats and missionaries.

A spokesman for the Treasury said:

“The increases the government has made to the personal allowance support hardworking people by helping them to keep more of the money they earn and, as a result, is one of the most generous in the world. 

At the same time, we believe that it is reasonable to consider whether non-residents who receive income from the UK are paying a fair share of tax on that income, in this country.”

The phrase "fair share" has become government mantra for "pay what we decide you should pay".

On the assumption that the expats were "hardworking" when in the UK, and paid a "fair share" when they were here, why should they now lose the allowance that everyone else is entitled to?

The deadline for comments on the consultation is 9 October.


Tax does have to be taxing.

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HMRC Is Shite (www.hmrcisshite.com), also available via the domain www.hmrconline.com, is brought to you by www.kenfrost.com "The Living Brand"