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# Taxation of non-residents on UK income and assets
 
# Taxation of non-residents on UK income and assets
 
# Taxation of UK residents on foreign income and assets  
 
# Taxation of UK residents on foreign income and assets  
 +
# Other topics arising in this context, including tax avoidance, and disclosure and compliance
  
 
It is the online version of [https://www.kessler.co.uk/taxation-of-foreign-domiciliaries/ ''Taxation of Non-Residents and Foreign Domiciliaries''] by [https://www.kessler.co.uk James Kessler QC].   
 
It is the online version of [https://www.kessler.co.uk/taxation-of-foreign-domiciliaries/ ''Taxation of Non-Residents and Foreign Domiciliaries''] by [https://www.kessler.co.uk James Kessler QC].   
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:10  [[Temporary Non-residence]]
 
:10  [[Temporary Non-residence]]
  
:11 [[Source/Relevant Foreign Income]]  
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:11 A [[Income Categorisation]]
 +
 
 +
:11 B [[Source/Relevant Foreign Income]]  
  
 
:12  [[The Remittance Basis]]
 
:12  [[The Remittance Basis]]
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:23  [[Dividend Income]]
 
:23  [[Dividend Income]]
  
:24  [[Royalty Income]]
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:24 A [[Annual Payments]]
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 +
:24 B [[Intellectual Property Income]]
  
 
:25  [[Misc Sweep-Up Income]]
 
:25  [[Misc Sweep-Up Income]]
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:39  [[Profit Fragmentation]]
 
:39  [[Profit Fragmentation]]
  
:NEW [[Transfer of Income Streams]]
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:40  [[Transfer of Income Streams]]
  
:40 [[Life Policies and Contracts]]
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:41 [[Life Policies and Contracts]]
  
:41 [[Offshore Funds: Definition]]
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:42 [[Offshore Funds: Definitions]]
  
:42 [[Offshore Income Gains]]
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:43 [[Offshore Income Gains]]
  
:43 [[Income from Offshore Funds]]
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:44 [[Income from Offshore Funds]]
  
:44 [[Accrued Income Profits]]
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:45 [[Accrued Income Profits]]
  
:45 [[Deeply Discounted Securities]]
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:46 [[Deeply Discounted Securities]]
  
:46 [[Unit Trusts]]
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:47 [[Unit Trusts]]
  
:47 [[Intermediated Securities]]
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:48 [[Intermediated Securities]]
  
:48  [[Partnerships]]
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:49 A [[Partnerships]]
  
:49 [[Non-Residents Income Tax Relief]]
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:49 B [[Partnership Income Shares]]
  
:50  [[Collection of Tax from UK Representatives]]
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:50  [[Non-Resident Income Tax Relief]]
  
:51  [[Investment Manager Exemptions]]
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:51  [[Collection of Tax from UK Representatives]]
  
:52  [[Investment Management Fees & Carried Interest]]
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:52  [[Investment Manager Exemptions]]
  
:53  [[Loans from Non-Resident Companies]]
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:53  [[Investment Management Fees & Carried Interest]]
  
:54 [[Transactions in Securities]]
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:54 [[Loans from Non-Resident Companies]]
  
:55 [[Rates of Income Tax/CGT]]
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:55 [[Transactions in Securities]]
  
:56  [[Personal Allowances]]
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:56  [[Rates of Income Tax/CGT]]
  
:57  [[National Insurance Contributions]]
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:57  [[Personal Allowances]]
  
:58  [[Chargeable Gains]]
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:58  [[National Insurance Contributions]]
  
:59  [[UK Property Held by Non-Residents]]
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:59  [[Chargeable Gains]]
  
:60  [[Private Residence Relief]]
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:60  [[UK Property Held by Non-Residents]]
  
:61  [[Gains of Non-Resident Settlor-Interested Trusts: s.86]]
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:61  [[Residential Property: CGT]]
  
:62  [[Capital Payments from Non-Resident Trusts: s.87]]
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:62  [[Gains of Non-Resident Settlor-Interested Trusts: s.86]]
  
:63  [[Borrowing by Non-Resident Trust: Sch 4B]]
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:63  [[Capital Payments from Non-Resident Trusts: s.87]]
  
:64  [[Protected Trusts]]
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:64  [[Borrowing by Non-Resident Trust: Sch 4B]]
  
:65  [[Sub-Funds]]
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:65  [[Protected Trusts]]
  
:66  [[Gains of Non-Resident Companies]]
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:66  [[Sub-Funds]]
  
:67  [[Capital Losses]]
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:67  [[Gains of Non-Resident Companies]]
  
:68  [[Foreign Currency Issues]]
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:68  [[Capital Losses]]
  
:69  [[Unremittable Assets]]
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:69  [[Foreign Currency Issues]]
  
:70  [[Double Taxation Arrangements: Introduction]]
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:70  [[Unremittable Assets]]
  
:71  [[DTA Anti-abuse Rules]]
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:71  [[Double Taxation Arrangements: Introduction]]
  
:72  [[Foreign Tax Credit Relief]]
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:72  [[DTA Anti-abuse Rules]]
  
:73 [[EU Law and UK Taxation]]
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:73 [[Limitation on Benefits]]
  
:74  [[Excluded Property: Definition]]
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:74  [[Foreign Tax Credit Relief]]
  
:75  [[Excluded Property Exemptions]]
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:75  [[EU Law and UK Taxation]]
  
:76  [[Wills and IOVs]]
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:76  [[Excluded Property: Definition]]
  
:77  [[Reservation of Benefit]]
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:77  [[Excluded Property Exemptions]]
  
:78  [[Inter-Trust Transfers: IHT]]
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:78  [[Wills and IOVs]]
  
:79  [[IHT Deduction for Debts]]
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:79  [[Reservation of Benefit]]
  
:80  [[IHT Double Taxation Treaties: Introduction]]
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:80  [[Inter-Trust Transfers: IHT]]
  
:81  [[IHT DTAs: India, Pakistan, Italy, France]]
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:81  [[IHT Deduction for Debts]]
  
:82  [[IHT DTA: Netherlands]]
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:82  [[IHT Close-Company Code]]
  
:83 [[IHT DTA: Switzerland]]
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:83 [[IHT Double Taxation Treaties: Introduction]]
  
:84  [[IHT DTA: USA]]
+
:84  [[IHT DTAs: India, Pakistan, Italy, France]]
  
:85  [[Foreign IHT Credit Relief]]
+
:85  [[IHT DTA: Netherlands]]
  
:86 [[Non-Dom/Non-Resident Spouse]]
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:86 [[IHT DTA: South Africa]]
  
:87 [[Family Home and Chattels: Benefit in Kind Charges]]
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:87 [[IHT DTA: Switzerland]]
  
:88  [[IHT Residential Property Code]]
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:88  [[IHT DTA: USA]]
  
:89  [[Pre-Owned Assets]]
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:89  [[Foreign IHT Credit Relief]]
  
:90  [[Joint Accounts]]
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:90  [[IHT Residential Property Code]]
  
:91  [[ATED Taxes]]
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:91  [[Family Home and Chattels: Benefit in Kind Charges]]
  
:92  [[Estates of Deceased Persons: CGT]]
+
:92  [[Pre-Owned Assets]]
  
:93  [[Estates of Deceased Persons: Income Tax]]
+
:93  [[Non-Dom/Non-Resident Spouse]]
  
:94  [[Who is the Settlor?]]
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:94  [[Joint Accounts]]
  
:95  [[Trusts with Two or More Settlors]]
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:95  [[ATED Taxes]]
  
:96  [[Situs of Assets for IHT]]
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:96  [[Estates of Deceased Persons: CGT]]
  
:97  [[Situs of Assets for CGT]]
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:97  [[Estates of Deceased Persons: Income Tax]]
  
:98  [[Foreign Entities]]
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:98  [[Who is the Settlor?]]
  
:99  [[Hybrid Entities]]
+
:99  [[Trusts with Two or More Settlors]]
  
:100 [[Control Connected Close and Related Expressions]]
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:100 [[Situs of Assets for IHT]]
  
:101 [[Permanent Establishment and Branch/Agency]]
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:101 [[Situs of Assets for CGT]]
  
:102 [[Reporting and Compliance]]
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:102 [[Foreign Entities]]
  
:103 [[Claims]]
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:103 [[Hybrid Entities]]
  
:104 [[Reporting and compliance: IHT]]
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:104 [[Control Connected Close and Related Expressions]]
  
:105 [[Reporting Beneficial Owners]]
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:105 [[Permanent Establishment and Branch/Agency]]
  
:106 [[Disclosure of Offshore Trusts]]  
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:106 [[Reporting and Compliance]]
  
:107 [[Requirement to Correct]]
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:107 [[Claims]]
  
:108 [[Criminal Law and Professional Conduct]]
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:108 [[Reporting and compliance: IHT]]
 +
 
 +
:109 [[Reporting Beneficial Owners]]
 +
 
 +
:110 [[Reporting Offshore Trusts]]
 +
 
 +
:111 [[Requirement to Correct]]
 +
 
 +
:112 [[Money Laundering]]
  
  
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<big>'''Appendices'''</big>
 
<big>'''Appendices'''</big>
  
:[[Appendix 1: Words of Dispute]]
+
:[[Appendix 1 Words of Dispute]]
  
:[[Appendix 2: Common Legal Expressions]]  
+
:[[Appendix 2 Common Legal Expressions]]  
  
:[[Appendix 3: Family Terminology]]  
+
:[[Appendix 3 Family Terminology]]  
  
:[[Appendix 4: Consideration, Arm's Length/Full Value]]
+
:[[Appendix 4 Consideration/Arm's Length/Full Value]]
  
:[[App New:    Commercial/View to Profit]]
+
:[[Appendix 5A  Commercial/View to Profit]]
  
:[[Appendix 5: Associated Operations: IHT]]
+
:[[Appendix 5B Income Recognition: Receive/Entitled/Arise/Paid]]
  
:[[Appendix 6: Deeming Provisions]]
+
:[[Appendix 6 Associated Operations: IHT]]
  
:[[App New:    Territorial Limits]]
+
:[[Appendix 7 Deeming Provisions]]
  
:[[Appendix 7: What Do We Mean by "Real"]]
+
:[[Appendix 8 The Territorial Principle]]
  
:[[Appendix 8: Parliamentarians]]
+
:[[Appendix 9 What Do We Mean by "Real"]]
  
:[[Appendix 9: Visiting Forces]]
+
:[[Appendix 10 Parliamentarians]]
  
:[[Appendix 10: How to Improve Residence and Domicile Taxation]]
+
:[[Appendix 11 Visiting Forces]]
  
:[[Appendix 11: Reform of Offshore Anti-avoidance Rules]]
+
:[[Appendix 12 How to Improve Residence and Domicile Taxation]]
  
:[[Appendix 12: UK Arrival or Departure: Tax Checklist]]
+
:[[Appendix 13 Reform of Offshore Anti-avoidance Rules]]
  
:[[Appendix 13: The Wisdom of Parliament]]
+
:[[Appendix 14 UK Arrival or Departure: Tax Checklist]]
  
 +
:[[Appendix 15 The Wisdom of Parliament]]
  
 +
:[[Appendix 16 Participation Test]]
 +
 +
:[[Appendix New: Non-discrimination]]
  
 
</div>
 
</div>
  
  
<big>'''New 2019/20 edition now out'''</big>
+
<big>'''2020/21 edition'''</big>
  
The 2019/20 printed edition of ''Taxation of Non-residents and Foreign Domiciliaries'' is now out. The online edition contains the text of that edition with some subsequent [[Update | updates]].
+
This site contains the text of the 2020/21 edition of ''Taxation of Non-residents and Foreign Domiciliaries'' with some post-publication [[Update | updates]].
 +
 
 +
The paper version of the book is also now out.
 +
 
 +
To access TFD online, you will need an online licence. To obtain this, go to
 +
[https://www.khpplc.co.uk/ the publishers website] or email [mailto:aw.khpplc@khpplc.co.uk?Subject=TFD%20online aw.khpplc@khpplc.co.uk] 
 +
 
 +
Licences for the 2019/20 edition are no longer valid.
 +
 
 +
If you are an academic who wants access for research purposes, [mailto:kessler@kessler.co.uk?Subject=TFD%20online contact James Kessler]
  
 
<big>'''How to login'''</big>
 
<big>'''How to login'''</big>
Line 279: Line 305:
 
Most of this site requires you [[Special:Userlogin|to login]].  To obtain a login licence:
 
Most of this site requires you [[Special:Userlogin|to login]].  To obtain a login licence:
  
    Every copy of the printed book has a 3 week trial licence (see inside back cover of volume 1)  To order copies of the book [mailto:aw@khpplc.co.uk?Subject=TFD%20enquiry email the publishers] or [http://khpplc.co.uk/ go to the publishers' website].
+
*** Every copy of the printed book has a 3 week trial licence (see inside back cover of volume 1)  To order copies of the book [mailto:aw@khpplc.co.uk?Subject=TFD%20enquiry email the publishers] or [http://khpplc.co.uk/ go to the publishers' website].
 
+
*
    You may purchase a single or multiple user licence:  To obtain these [mailto:mv.khpplc@khpplc.co.uk?Subject=TFD%20contact%20publisher%20request%20multiple%20user%20licences contact the publishers].
+
** You may purchase a single or multiple user licence:  To obtain these [mailto:mv.khpplc@khpplc.co.uk?Subject=TFD%20contact%20publisher%20request%20multiple%20user%20licences contact the publishers].
  
    Without logging in, you can access: Chap 1 [[Foreign Domicile: Tax Policy]]; Chap 2 [[Tax Avoidance]].
+
*** Without logging in, you can access:  
 +
:Chapter 1 [[Foreign Domicile: Tax Policy]]  
 +
:Chapter 2 [[Tax Avoidance]].
  
 
You enter this site once you have registered and [[Special:Userlogin| logged in]] by clicking on the index on the left, or you can search the text.
 
You enter this site once you have registered and [[Special:Userlogin| logged in]] by clicking on the index on the left, or you can search the text.
  
You need to register with the password for the current edition. Registration for an earlier edition is not valid.
+
You need to register for the current edition. Registration for an earlier edition is not valid.
  
 
<big>'''Comments please'''</big>
 
<big>'''Comments please'''</big>
  
Users can also [[contribute to the text]] and if you can add anything, or spot anything that needs to be corrected, please do!  A copy of the next edition of the book will be given to the user who makes the most edits.  User contributions are reviewed by [https://www.taxchambers.com/barrister/ross-birkbeck/ Ross Birkbeck].   
+
Users can also [[contribute to the text]] and if you can add anything, or spot anything that needs to be corrected, please do!  A copy of the next edition of the book will be given to the user who makes the most edits.  User contributions are reviewed by [https://www.taxchambers.com/team/ross-birkbeck/ Ross Birkbeck].   
  
 
<big>'''If you want further advice'''</big>
 
<big>'''If you want further advice'''</big>
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<big>'''Archive editions'''</big>
 
<big>'''Archive editions'''</big>
  
There are [[archive editions]] for years since 2003/04.  These will occasionally be useful to investigate the tax position in earlier years, but the current edition will generally be the best starting point, as that has been written in the light of current HMRC guidance, and further thought and research.
+
There are [[archive editions]] for years since 2003/04.  These will be useful to investigate the tax position in earlier years, but the current edition will generally be the best starting point, as that has been written in the light of current HMRC guidance, and further thought and research.
  
 
<big>'''Contact '''</big>
 
<big>'''Contact '''</big>
Line 313: Line 341:
 
<big>'''Technical notes'''</big>
 
<big>'''Technical notes'''</big>
  
TFD online is in technical terms a [http://en.wikipedia.org/wiki/Wiki Wiki] on the lines of [http://en.wikipedia.org Wikipedia], but only registered users can edit the text.
+
TFD online is a [http://en.wikipedia.org/wiki/Wiki Wiki] on the lines of [http://en.wikipedia.org Wikipedia], but only registered users can edit the text.
  
 
Site hosting and management by [http://www.highwiredesign.com: Highwire] </big>
 
Site hosting and management by [http://www.highwiredesign.com: Highwire] </big>

Latest revision as of 08:17, 3 July 2020

This site provides comprehensive information about:

  1. Taxation of foreign domiciliaries
  2. Taxation of non-residents on UK income and assets
  3. Taxation of UK residents on foreign income and assets
  4. Other topics arising in this context, including tax avoidance, and disclosure and compliance

It is the online version of Taxation of Non-Residents and Foreign Domiciliaries by James Kessler QC.

Contents

Update

Introduction

1 Foreign Domicile: Tax Policy
2 Tax Avoidance
3 Domicile
4 Deemed Domicile
5 Residence of Individuals
6 Residence of Trustees
7 Treaty-Residence
8 Exit Taxes
9 Split Years: Arrival and Departure
10 Temporary Non-residence
11 A Income Categorisation
11 B Source/Relevant Foreign Income
12 The Remittance Basis
13 The Meaning of Remittance
14 Remittance Reliefs
15 Mixed Funds
16 Trading Income
17 Trading in Land
18 Performers
19 Property Income
20 Deduction of interest from Property Income
21 Interest Income
22 Exempt Interest of Non-Residents
23 Dividend Income
24 A Annual Payments
24 B Intellectual Property Income
25 Misc Sweep-Up Income
26 Employment Income
27 Travel Expenses: Employment Income
28 PAYE
29 Employment Income: DT Relief
30 Pension and Annuity Income
31 Discretionary Trusts: Income Tax
32 IIP Trusts: Income Tax
33 Settlor-interested Trust Code
34 Transfer of Assets Abroad: Introduction
35 Transfer of Assets Abroad: Transferors
36 Transfer of Assets Abroad: Benefits
37 Transfer of Assets Abroad: Relief from Overlapping Charges
38 Transfer of Assets Abroad: Motive Defence
39 Profit Fragmentation
40 Transfer of Income Streams
41 Life Policies and Contracts
42 Offshore Funds: Definitions
43 Offshore Income Gains
44 Income from Offshore Funds
45 Accrued Income Profits
46 Deeply Discounted Securities
47 Unit Trusts
48 Intermediated Securities
49 A Partnerships
49 B Partnership Income Shares
50 Non-Resident Income Tax Relief
51 Collection of Tax from UK Representatives
52 Investment Manager Exemptions
53 Investment Management Fees & Carried Interest
54 Loans from Non-Resident Companies
55 Transactions in Securities
56 Rates of Income Tax/CGT
57 Personal Allowances
58 National Insurance Contributions
59 Chargeable Gains
60 UK Property Held by Non-Residents
61 Residential Property: CGT
62 Gains of Non-Resident Settlor-Interested Trusts: s.86
63 Capital Payments from Non-Resident Trusts: s.87
64 Borrowing by Non-Resident Trust: Sch 4B
65 Protected Trusts
66 Sub-Funds
67 Gains of Non-Resident Companies
68 Capital Losses
69 Foreign Currency Issues
70 Unremittable Assets
71 Double Taxation Arrangements: Introduction
72 DTA Anti-abuse Rules
73 Limitation on Benefits
74 Foreign Tax Credit Relief
75 EU Law and UK Taxation
76 Excluded Property: Definition
77 Excluded Property Exemptions
78 Wills and IOVs
79 Reservation of Benefit
80 Inter-Trust Transfers: IHT
81 IHT Deduction for Debts
82 IHT Close-Company Code
83 IHT Double Taxation Treaties: Introduction
84 IHT DTAs: India, Pakistan, Italy, France
85 IHT DTA: Netherlands
86 IHT DTA: South Africa
87 IHT DTA: Switzerland
88 IHT DTA: USA
89 Foreign IHT Credit Relief
90 IHT Residential Property Code
91 Family Home and Chattels: Benefit in Kind Charges
92 Pre-Owned Assets
93 Non-Dom/Non-Resident Spouse
94 Joint Accounts
95 ATED Taxes
96 Estates of Deceased Persons: CGT
97 Estates of Deceased Persons: Income Tax
98 Who is the Settlor?
99 Trusts with Two or More Settlors
100 Situs of Assets for IHT
101 Situs of Assets for CGT
102 Foreign Entities
103 Hybrid Entities
104 Control Connected Close and Related Expressions
105 Permanent Establishment and Branch/Agency
106 Reporting and Compliance
107 Claims
108 Reporting and compliance: IHT
109 Reporting Beneficial Owners
110 Reporting Offshore Trusts
111 Requirement to Correct
112 Money Laundering


Appendices

Appendix 1 Words of Dispute
Appendix 2 Common Legal Expressions
Appendix 3 Family Terminology
Appendix 4 Consideration/Arm's Length/Full Value
Appendix 5A Commercial/View to Profit
Appendix 5B Income Recognition: Receive/Entitled/Arise/Paid
Appendix 6 Associated Operations: IHT
Appendix 7 Deeming Provisions
Appendix 8 The Territorial Principle
Appendix 9 What Do We Mean by "Real"
Appendix 10 Parliamentarians
Appendix 11 Visiting Forces
Appendix 12 How to Improve Residence and Domicile Taxation
Appendix 13 Reform of Offshore Anti-avoidance Rules
Appendix 14 UK Arrival or Departure: Tax Checklist
Appendix 15 The Wisdom of Parliament
Appendix 16 Participation Test
Appendix New: Non-discrimination


2020/21 edition

This site contains the text of the 2020/21 edition of Taxation of Non-residents and Foreign Domiciliaries with some post-publication updates.

The paper version of the book is also now out.

To access TFD online, you will need an online licence. To obtain this, go to the publishers website or email aw.khpplc@khpplc.co.uk

Licences for the 2019/20 edition are no longer valid.

If you are an academic who wants access for research purposes, contact James Kessler

How to login

Most of this site requires you to login. To obtain a login licence:

      • Without logging in, you can access:
Chapter 1 Foreign Domicile: Tax Policy
Chapter 2 Tax Avoidance.

You enter this site once you have registered and logged in by clicking on the index on the left, or you can search the text.

You need to register for the current edition. Registration for an earlier edition is not valid.

Comments please

Users can also contribute to the text and if you can add anything, or spot anything that needs to be corrected, please do! A copy of the next edition of the book will be given to the user who makes the most edits. User contributions are reviewed by Ross Birkbeck.

If you want further advice

If you do not find the answer to your question here, or if you want advice on which you can legally rely, you may instruct James Kessler QC to advise. See How to instruct James Kessler QC.

Archive editions

There are archive editions for years since 2003/04. These will be useful to investigate the tax position in earlier years, but the current edition will generally be the best starting point, as that has been written in the light of current HMRC guidance, and further thought and research.

Contact

If you have technical problems, or problems logging in, click here

To contact James Kessler QC click here

To contact Ross Birkbeck, who reviews online contributions, click here

For multiple user licences, or to install on a firm's intranet, contact the publishers.

Technical notes

TFD online is a Wiki on the lines of Wikipedia, but only registered users can edit the text.

Site hosting and management by Highwire