The tax structures on investments and properties maybe a little different living abroad. This means that expats must keep abreast of the latest changes to tax laws. Doing so will make it much easier to avoid any problems with HMRC when you choose to return to the United Kingdom and still get the most benefit from your assets.
Changes in Tax Codes
One of the more common errors that expats make with offshore tax planning is to assume that tax regulations for this year are the same as in years past. Making this assumption can be quite costly. For example, 2012 saw a change in how taxes are assessed on offshore portfolio bonds. Previously, investors could withdraw up to five percent of the bond’s value in a given tax year and not have to pay any type of tax obligation on the withdrawal, provided the investor was living abroad at the time. That is no longer the case. Failure to make note of this change could lead to significant penalties and fines at some future date.
The bottom line is that you are responsible for making sure that all taxable income related to your offshore investments are reported in accordance with current tax regulations. Even if your holdings are not particularly sizeable, failing to report the income properly could lead to closer scrutiny of all your income sources. That process can take time and may even limit access to certain assets until the matter is resolved.
Getting Reliable Tax Planning Advice
If you are not one who possesses a head for financial matters, it would be in your best interest to secure the services of a tax professional. Make sure that professional is well versed in the laws that apply to investments held by expatriates. This includes holdings that are based in the UK as well as assets that you are based in either your current country of residence or any other nations. This is because you will likely have to deal not only with HMRC but also with tax agencies in those countries as well.
The goal is to make sure that you take advantage of any applicable tax laws that apply to your situation, by doing so means that you are able to claim exemptions and deferments when and as they are allowed by current laws. As a result, you do not end up overpaying your taxes. At the same time, you also avoid the risk of underpaying and creating what could be a colossal headache down the road. Offshore tax advice of this type will serve you well over the long term.
Don’t Wait Until the Last Minute
The time to create a viable offshore tax strategy is now. There is no need to wait until days before tax returns must be filed or attempt to beg pardon from the taxman after the fact. In order to protect your interests, find the right professional to work with today. Make sure that you don’t simply turn over your documents to the professional with instructions to deal with the situation. Become a part of the process and learn all you can from the professional. All that information will come in handy as you evaluate the possibility of securing more assets in the future, particularly in terms of understanding how those acquisitions would impact your tax liability.
Whichoffshore provide professional expatriate information on many financial topics; qrops Pensions, Offshore investments and more, in order to help British expatriate make the most of their offshore savings and investments. For more information, please visit - www.whichoffshore.com