If you return to the UK after you have arrived as non-residents, you may have to pay taxes on all assets you owned before leaving the UK, even if you paid income taxes in the country in which you moved. As a general rule, you can apply for a double tax relief. There are many circumstances in which double taxation can occur. A few examples are that certain types of British visitors are subject to special treatment under a double taxation agreement, such as students, teachers or overseas government officials. Another common double taxation situation is that of a person who is not resident in the United Kingdom but who has income from the United Kingdom and who remains tax resident in his or her country of origin. You may not have to pay twice if the country in which you reside has a “double taxation agreement” with the UK. Depending on the agreement, you can ask for both: the method of double taxation “relief” depends on your exact circumstances, the nature of the income and the specific wording of the contract between the countries concerned. Double taxation occurs when local legislation leads to taxes levied on the same income, capital profits or corporate profits in more than one country. This can be mitigated by the application of double taxation agreements or by unilateral facilities where there is no contract or when a contract does not cover the tax categories involved. If you live in one EU country and work in another country, the tax rules for your income depend on national laws and double taxation conventions between the two countries – and the rules may differ considerably from those that determine the country responsible for social security issues. In both countries, a double taxation convention is in domestic law.
For example, if you are not based in the UK and you have bank interest in the UK, that income would be taxable in the UK as UK income under national law. However, if you live in France, the double taxation agreement between the United Kingdom and France stipulates that interest should only be taxable in France. This means that the UK must waive its right to tax these revenues. In this case, you would be entitled to HMRC (in practice, this would usually be done on a self-assessment return) to exempt INCOME from UK tax. Here you will find information on UK tax treaties, associated tax documents and multilateral agreements. To apply for the double tax exemption, you may need to prove where you live and that you have already paid taxes on your income. Check with tax authorities to find out what documents and documents you need to submit. There is a list of current double taxation agreements on GOV.UK.
As a general rule, they still receive relief, even if there is no agreement, unless the foreign tax does not correspond to UK income tax or capital gains tax. The ICAEW library subscribes to an IBFD international tax research platform, which provides access to a collection of approximately 10,000 double taxation agreements currently in force. These ICAEW members and ACA students are available on request, along with a number of materials that can help you interpret and apply them. Contracts are provided by e-mail. For example, a person who resides in the United Kingdom but has rental income from a property in another country will likely have to pay taxes on rental income, both in the United Kingdom and in that other country.