:: Leaving the UK ::

Does claiming a tax rebate affect your eligibility to come back to the UK?

Tax rebate work in the UK

Does claiming a tax rebate affect your eligibility to come back to the UK?

There are a number of reasons why you may be able to claim a UK tax rebate. You may have had too much tax taken from your pay. You may have stopped work part way through a tax year. Or, you may have paid too much tax having completed a tax return.

A common reason for claiming a tax rebate is if you have worked in the UK for part of a tax year, and then you spend the rest of the year living and working in another country.

Our guide looks at claiming a tax rebate if you live abroad, and whether it affects your eligibility to come back to the UK.

If you leave the UK you may be able to claim a tax rebate

If you have worked for part of the tax year in the UK and then you leave then you may be able to claim a tax refund.

Your income is likely to have been taxed assuming that you were going to be working in the UK for the whole tax year. Your tax code is likely to have been such that your tax-free allowances were spread over a 12 month period. So, if you work part of the year in the UK and then head overseas, you may be eligible to get some of the tax you have paid in the UK back.

Claiming a tax rebate does not automatically affect your eligibility to return to the UK

It is important to note that claiming a tax rebate does not affect your eligibility to return to the UK. Just because you have claimed some tax back does not mean that you are prevented from returning to live and work in the UK – either in the same tax year or in a different tax year.

You should always check your visa and rights of residence in the UK. These are separate to your tax affairs and determine whether you are allowed to legally live and work in the UK.

Returning to the UK in the same tax year

If you were to return to the UK in the same tax year that you left (even if you had claimed a tax rebate) you would once again start to pay tax on any earnings. You would be given a tax code and tax would be deducted.

Even if you have claimed a tax rebate for that tax year, your eligibility to return would not be affected. Any underpayment or overpayment could be calculated at the end of the tax year and you will either receive a tax bill or a tax rebate, depending on whether you have paid too much or too little tax.

5 Dumb Reasons Why People Don’t Claim Their Tax Rebate

Have you paid too much tax? If so, you may be eligible to claim a tax rebate (or ‘tax refund’) which may be worth hundreds or even thousands of pounds.

However, millions of pounds of tax rebates go unclaimed each year for a range of reasons. We’ve put together a guide to five of the most common reasons why people are missing out on reclaiming thousands of pounds of their own cash. Keep reading to make sure you avoid these mistakes.

It is too much hassle

Most people assume that claiming back tax will be a lot of hassle. However, the process is actually more straightforward than you may think. If you think you have paid too much tax you simply have to telephone HMRC or send them a letter explaining why you think you have overpaid.

If you don’t want to deal with HMRC yourself, there are a range of expert ‘tax rebate’ services who will process your claim on your behalf. Sites such as Tax Fix can help you to reclaim your overpaid tax and take the hassle out of your claim.

It is too late

Don’t assume that it is too late to make your tax rebate claim. You normally have up to four years to make a claim for overpaid tax.

If you’re a self assessment taxpayer you have until 5 April 2014 to make a claim for tax you overpaid in the tax year 2009/10. You can claim overpaid tax from the 2010/11 tax year until 5 April 2015.

If you’re a PAYE taxpayer the deadline to make your tax rebate claim for the 2009/10 tax year is 5 April 2014. If you want to claim for the 2010/11 tax year you have until 5 April 2015.

Tax rebates are just for foreigners

Many UK residents are under the mistaken impression that tax rebates are only for foreigners who work in the UK for a short time.

In reality, anyone who has worked in the UK could be due a tax rebate. There are lots of reasons that you may have paid too much tax, and we’ll outline some of these next.

I don’t think I am eligible

Don’t assume that you have paid the right amount of tax or that you aren’t eligible for a tax rebate. There are lots of reasons why you may have paid too much tax. These include:

  • You had more than one job
  • You were on an emergency tax code for part of the tax year
  • You only worked for part of the tax year
  • Your employer used the wrong tax code
  • You are a student and didn’t complete the P38S form
  • Other income taxed through your tax code has reduced since you told HMRC about it

I don’t have the right forms

Many people try to apply for a rebate and give up when they find that they don’t have a P60 or P45.

However, it is possible to obtain duplicates of these forms and other information you need to make your claim. Again, a tax rebate claims service can give you advice and help you in this regard.

Leaving the UK in 2014? Don’t forget to claim your tax rebate

Are you are planning on leaving the UK in 2014? Perhaps you are taking up employment in another country? Maybe you’re emigrating with your family? Or, your job in the UK may have ended and you’re moving elsewhere?

If you’re planning on leaving the UK in 2014 then you may be due a tax rebate. While many thousands of people every year leave the UK without checking whether they are entitled to a tax rebate many other claim back hundreds or even thousands of pounds in overpaid tax.

Our guide looks at when you become non-UK resident for income tax and how you go about claiming a tax refund when you live the UK.

Why you might be due a tax rebate

If you are leaving the UK in 2014 the chances are that it will be part way through a tax year. If your employment ends during a tax year then you can quite often be due a tax rebate.

This is because your personal allowance – the amount you can earn before you start to pay income tax – is generally split into equal monthly instalments. So, when you leave the UK you would be due back any unused part of your personal allowance in that tax year.

When are you non-resident for UK Income Tax?

You will be treated as non-resident from the day after you leave the UK if you can show that:

  • you left the UK to go abroad permanently or your absence and full-time work abroad lasts at least the whole tax year
  • your visits to the UK are less than 183 days in a tax year and average less than 91 days a tax year over a maximum of four consecutive years

What to do when you are leaving the UK

You must tell HMRC if you’re leaving the UK to live or work abroad or if you’re returning home or moving to another country after a period of living and working in the UK.

Normally, one of two things will happen:

  • You will be asked to complete a tax return
  • You will have to complete form P85 ‘Leaving the UK – getting your tax right’

HMRC will use the information on either your tax return or the P85 form to send you any tax refund you’re owed and work out if you’ll become non-resident. It’s important that you enclose the original parts 2 and 3 of form P45 if you have one as HMRC will not be able to make any tax refund you are owed without them.

If you’re leaving the UK to work full-time abroad for a UK based employer for at least a complete tax year, you’ll need to fill in a tax return as well as a form P85.

Do you still have questions? If so check out the explainer video that we created below, if that does not answer your question, feel free to leave a question in the comments below and we will answer it personally:

 

Tax when leaving the UK

Thousands of people leave the UK every month to live or work abroad.  In 2010, BBC’s Newsnight reported that a staggering 450,000 emigrate from the UK each year to set up a new life overseas.

If you are planning to work or live abroad, you may well become a ‘non-resident’ in the UK.  This means that you may stop paying UK income tax on your earnings, although you may continue to have a tax liability if you continue to receive any income in the UK.

Our guide looks at how your tax is affected when you leave the UK.

When do you become ‘non resident’ for UK income tax?

You will be treated as a ‘non resident’ for tax purposes from the day after you leave the UK.  However, you must demonstrate that:

  • You left the UK permanently or for at least the entire tax year
  • Your visits to the UK are less than 183 days in a tax year and average below 91 days over a maximum of four consecutive years

What you have to do when you leave the UK

If you are emigrating or planning to leave the UK you must inform HM Revenue and Customs (HMRC).  If you are not required to complete a tax return you will be obliged to complete the form P85 Leaving the UK – Getting Your Tax Right.  You will also have to enclose parts 2 and 3 of your P45 if you have one.

HMRC will consider the information on this form and will work out if you will become non-resident.  They will also send you any tax rebate that you are owed.

What if part of your work is in the UK?

You may move abroad but part of your work remains in the UK.  In this case, you will continue to pay UK income tax on your earnings from the work you do in this country.  This is normally done by allocating your earnings based on the number of days you work in the UK and the number of days you work overseas.

What if you have other UK based income?

Even if your work is outside the UK, you may continue to earn money in the UK through savings, pensions or property.  In these scenarios, you may still have to pay some UK income tax.

For example, if you are ‘non resident’ you will still pay tax on your savings interest.  UK tax will also be due on income from a rental property and on your UK pensions.

If you have any other questions, watch the short explainer video below or alternatively ask a question in the comments and we’ll personally answer it:

 

 

Paying Tax If You’re Leaving The UK

Are you going to live or work abroad?

If so, you’ll need to know what tax you will continue to pay in the UK.  Our guide looks at when you do and don’t have to pay UK income tax when you move abroad.

Becoming non-resident for tax purposes

You’ll be treated as a non-resident from the day after you leave the UK if:

  • You can show that your visits to the UK are less than 183 days in a tax year and average less than 91 days a tax year over a maximum of four consecutive years
  • You can show that you left the UK to go abroad permanently or your absence and full-time work abroad lasts at least the whole tax year

If you’re leaving the UK you must tell HM Revenue & Customs (HMRC).  Your Tax Office will give you a P85 form (‘Leaving the United Kingdom’) in order that you can claim any tax refund that you’re owed.  HMRC will also work out if you’ll become non-resident.  If you still need to complete a tax return after you leave the UK, they’ll let you know.

Paying tax on your employment income

If you become non-resident, you won’t pay UK income tax on your earnings from working overseas.

However, if you’re non-resident but part of your work is in the UK, you’ll pay UK tax on the part of your earnings allocated to that work.  You usually allocate your earnings by looking at the number of days you work in the UK and the number of days you work abroad.

There are special rules for certain professions including seafarers, entertainers, students, Crown employees, oil workers and sports people.

Paying tax on other sources of income

Pensions

If you’re non-resident, you’ll pay UK tax on your UK pensions including your State Pension.

However, you may not pay UK tax if the country you live in has a ‘double taxation’ agreement with the UK. If you are a resident of a country with which the UK has a double taxation agreement, you may be able to claim exemption or partial relief from UK tax on certain types of UK income, such as pensions.

Property

If you’re non-resident and rent from UK property is paid directly to you, your tenant must deduct UK tax at the basic rate (currently 20 per cent).  If you use a letting agent, they’ll deduct the tax from the rent after any allowable expenses have been paid.

You can apply to have the rent paid to you without tax deducted if you don’t think you’ll have to pay any UK tax, although you’ll still need to declare the rent on a Self Assessment tax return if you’re required to complete one.

If the country you live in has a double taxation agreement with the UK you may be able to get relief there for any tax paid in the UK.

Interest

With regards to bank and building society interest in the UK, if you’re non-resident, the only UK tax you’ll usually pay is the tax deducted before you get the interest.  If you’re also ‘not ordinarily resident’ (i.e. you normally live outside the UK), you can get your interest without any tax being deducted by completing the R105 form and giving this to your bank or building society.

If tax has been deducted from your savings interest, you may be able to claim a refund by using the R43 form.

If you have any other questions, watch the short explainer video below or alternatively ask a question in the comments and we’ll personally answer it:

 

 

5 Things You Should Know About Income Tax When Arriving in the UK

Are you moving to the UK to work?

If you are, then you are likely to have to pay income tax in the UK.  The tax you pay depends on two main factors: how long you plan to remain in the UK and whether you intend to live here permanently.

1. Residence and Domicile

The income tax that you will pay in the UK depends on whether you are ‘resident’, ‘ordinarily resident’ or ‘domiciled’ in the UK.  It is possible to fall into more than one – or indeed none – of these categories.

Resident

You are classed as a ‘resident’ for tax purposes if:

  • You are in the UK for 183 days or more in a tax year
  • You come to the UK to live permanently or for at least three years
  • You are in the UK for an average of 91 days or more in a tax year (worked out over a maximum of four consecutive tax years)

Ordinarily resident

If you are resident in the UK year after year you will normally be treated as ‘ordinarily resident’.  If it is clear on your arrival that you intend to stat for at least three years then you will be treated as ‘ordinarily resident’ from the date of your arrival.

Domiciled

Your domicile is normally acquired at birth.  However, ‘domicile’ is a more complicated issue and covers a range of factors.

2. What you will pay income tax on if you are resident and ordinarily resident

If you are both ‘resident’ and ‘ordinarily resident’ for tax purposes you will pay income tax on all the work you do in the UK, all UK pensions and all your UK investments.  If you are also ‘UK domiciled’ you will also pay tax on all your overseas income.

If you are not ‘UK domiciled’ you will usually pay tax only on overseas income that you bring into the UK.  However, you will pay tax on all your earnings if you work overseas for a UK employer and on all your earnings if you work in the UK for an overseas employer.

There are special tax allowances for seafarers who spend long periods outside the UK and people who receive overseas pensions.  Contact your Tax Office for more details.

Non UK Resident?
Claim Your Tax Back

3. What you will pay income tax on if you are resident but NOT ordinarily resident

If you are ‘resident’ but not ‘ordinarily resident’ you will pay tax on all your UK income.  You will usually only pay tax on overseas income you bring into the UK.  In addition, you will pay tax on earnings for work done abroad that you bring into the UK.

4. What you will pay income tax on if you are NOT resident

If you are not a resident for tax purposes, you will still pay tax on your income from work you do in the UK, any UK pensions and all UK investments.  You’ll also pay tax on any rental income you receive from a UK property.

However, you won’t pay tax on your overseas income even if you bring it into the UK.

5. What happens if you arrive in the UK part way through a tax year

When you come to the UK part way through a tax year you’ll normally only pay tax on income you receive after you arrive.  This assumes that you are coming here to live permanently (or for at least two years) and you were not ‘ordinarily resident’ in the UK before you arrived.

Non UK Resident?
Claim Your Tax Back

What Everyone Should Know About Paying Tax When Working Overseas Or For A Non UK Employer

Do you work overseas for a UK employer?  Or do you work for an overseas employer in the UK?

If so, your tax rules and regulations may be more complicated than most people.  In these situations, the tax you will pay depends on where your employer is based, where you work and your residential status in the UK.

Our guide will help you determine what tax you will have to pay, and where.

Resident, ordinarily resident and domiciled

The tax rules are largely dependent on your tax status in the UK.  Most people fall into one of three categories:

  • Resident – You are a ‘resident’ for tax purposes if you are in the UK for more than 183 days in a tax year.  You are also a ‘resident for tax purposes from your date or arrival if you come to live in the UK permanently or you intend to remain for three years or more.  And, you are also treated as a ‘resident’ if you are in the UK for an average of 91 days or more in a tax year (worked out over a maximum of four consecutive tax years)
  • Ordinarily Resident – If you are a ‘resident’ for tax purposes in the UK year after year, you will generally be treated as ‘ordinarily resident’.  If you intend to stay in the UK for more than three years when you arrive, you will normally be treated as ‘ordinarily resident’ from the date of your arrival
  • Domiciled – ‘domicile’ is the most complicated tax status.  Your domicile is normally acquired at birth, but this is a general law concept covering a range of factors

It is possible that more than one of these definitions can apply to you – or even none of them at all.

What happens if you are ‘non resident for tax purposes’?

If you are ‘non resident’ in the UK for tax purposes, you will not pay any UK tax for the work you do overseas.  However, this work may be taxable in another country.

You will have to pay UK tax on any overseas earnings from work you do in the UK.  This will normally be paid via the Pay as You Earn (PAYE) scheme or you may have to complete a self assessment tax return.

What happens if you work entirely outside the UK for a UK employer?

In this situation, if you are ‘resident’ and ‘ordinarily resident’, you will pay tax on all your earnings.  If you are only ‘resident’, you will only pay tax on the earnings that you bring into the UK.

What happens if you work partly in the UK and partly outside the UK for a UK employer?

Here, if you are both ‘resident’ and ‘ordinarily resident’, you will pay tax on all your earnings.  If you are only ‘resident’, you will pay tax on all your earnings for work you do in the UK.  For the work you do overseas, you will only pay tax on the earnings you bring into the UK.

What happens if you work wholly outside the UK for an overseas employer?

Here, if you are ‘resident’ but not ‘domiciled’ you will only pay tax on earnings you bring into the UK.  If you are both ‘resident’ and ‘domiciled you will pay tax on all your earnings if you are ‘ordinarily resident’ but only pay tax on earnings you bring into the UK if you are not ‘ordinarily resident’.

What happens if you work partly in the UK and partly outside the UK for an overseas employer?

In this situation, if you are both ‘resident’ and ‘ordinarily resident’, you will pay UK tax on all your earnings.  If you are just ‘resident’, you will pay tax on all the earnings you receive for work you do in the UK, but only be taxed on earnings you bring into the UK for work you undertake overseas.

Non UK National Tax Refund

Non UK national tax  rebate

Every year over £300 million goes unclaimed in tax refunds from the Inland Revenue. If you are a Non UK national working in Britian, you may be able to claim a tax rebate. We answer some of the most common questions on this subject, if you can not see the answer you are looking for, please do not hesitate to contact us:

I am a Non UK national working in England. Can I claim a tax rebate?
As a Non UK national there are a number of reasons why you might be due a tax rebate. For example:

If you think you might be due a tax refund you can call free on 0800 955 2829 to discuss your situation further.

How can I calculate my tax rebate?
Every April, when the tax year finishes, you should be given a P60. Alternatively when you finish working for your employer, they should provide you with a P45.

Simply take the ‘Gross pay’ figure from the P45 or P60 and type this number into our tax rebate calculator . Do the same for the ‘total tax paid’ and then press on ‘Calculate’. The tax calculator will give you an estimate of the tax refund you will be due.

What if I do not have a P60?
If you do not have a P60 or P45 you can still check and claim a tax rebate from the UK government. You need to ask your employer for a statement of earnings on company headed paper. This will show how much you have earned and how much you have paid in tax and it is a sufficient replacement for a P60 or P45. If you like, we can get a maximum of two copies for you if you would like us to claim your tax rebate on your behalf.

How many years can I claim a tax rebate for?
You can claim for a maximum of 6 years. So if you worked in the UK any time in the last 6 years you can still make a claim.

How do I apply for my Non UK national tax refund?
You can either make a claim yourself or you can use a tax refund agent. A tax refund agent can obtain all the information required on your behalf. If however if you are claiming the refund yourself, you will need:

  • Any P45’s
  • Any P60’s
  • A P91 – Employment History form
  • P85/P86 – Leaving/Entering the UK forms
  • Covering Letter

If you have any other questions, watch the short explainer video below or alternatively ask a question in the comments and we’ll personally answer it:

 

 

National Insurance Rebate When Leaving the UK

national insurance refund  leaving the uk

Each year thousands of people leave the UK after having worked and paid tax and National Insurance (NI) contributions. This article will help you to learn if you can claim any of your NI back.

How much is National Insurance Tax?
Most people pay National Insurance at the rate of 11% of their earnings.

Can I claim a National Insurance refund if I am leaving the UK?
No, but you can claim a PAYE tax refund. If you are planning on leaving the UK you can apply here:

What are the requirements to claim a PAYE rebate?
You need to have worked and paid national tax in the UK. You can make a claim now even if you are not planning on leaving for sometime.

Can I come back to live/work in the UK if I claim a tax refund?
Claiming a tax refund does not affect your eligibility to live and work in the UK. To learn more about claiming your tax back from the Inland Revenue you can watch the video below:

How much will my tax refund be?
This will depend on your age and your income. You can use our calculator here to get an estimate.

Claiming Tax Back on a Working Holiday Visa

Working Holiday Visa Claim Tax Back

Every year, hundreds of thousands of people come to the UK to travel and work on a working holiday visa. Many travelers do not realise that when they return to their home country they are eligible to claim a tax refund on the taxes they paid in the UK. Here our tax expert answers some questions on how to claim a tax refund if you have been on a working holiday visa in the UK.

I am on a Working Holiday Visa. Can I claim a tax rebate?
Yes. As you are on a working holiday visa, you will be staying in the UK temporarily. As a result you will be able to claim a tax refund.

How much Tax can I claim back? Can I claim it all back?
This will depend on how much you have earned and paid in tax within the tax year. If for example you entered the UK at the start of March and worked immediately, there would only be one month left of the tax year and it is likely you will be able to claim back any tax that you paid. For an estimate of your tax rebate, you can use our tax refund calculator.

What do I need to claim my tax refund?
At the end of the tax year you should be given a P60. You can use this to check and claim your tax refund for the previous tax year. If you are leaving the UK, your employer should provide you with a P45. Once you have this, you can claim a tax refund

I have lost my P60/P45, can I still claim a tax rebate?
Yes. It might take a little longer but it is still possible to claim a tax refund without a P45 or P60. Simply ask all of your employers for a statement of earnings which is a sufficient replacement for a P45/P60 for the Inland Revenue. For more information read our article: claiming tax back without a P45/P60

I was on a working holiday visa but have since returned to my home country, can I still claim a rebate?
Yes. Even if you have returned home, you can still claim a tax refund from when you worked in the UK, as long as you are making your claim for tax paid within the last 6 years.

How long does it take to claim a tax rebate?
If you have your P60/P45 then it usually takes between 40-45 days to claim your tax refund. If you need to get a replacement P60/P45, it can take a little longer.

If you have any other questions, watch the short explainer video below or alternatively ask a question in the comments and we’ll personally answer it: