UK Government announcements suggest that they are keen to crack down on individual tax planning. However, the UK needs thousands of skilled migrants and many UK expat tax reliefs remain.
Common tax planning
An expatriate in the UK can often claim significant tax relief on for example her days worked overseas, upon her accommodation allowances and even non-UK investment income.
The best time to plan and secure UK tax savings is before the move ; and before employment terms are agreed.
A foreign national, before moving to the UK for two years, approached us for tax support. His assignment contract was not yet agreed. If it had been, this would not have been a disaster.
We have implemented the following UK tax savings :
- 30 % of income wholly exempt from tax – non UK earnings
- Full tax exemption on cost of living allowance
- 75% tax relief on company provided housing
- No tax due on payments into foreign pension plan
- Unlimited tax-free travel home to visit his family
- Rental income from several foreign properties tax-free in UK
Social security planning
We cannot do justice here to the whole subject. However,
- An expatriate from the EU can remain in their home social security scheme, by following certain procedures. We implement these “A1” form applications.
- A US expatriate can often pay into their home (FICA) and avoid National Insurance based upon the US/UK agreement. We facilitate this.
- An assignee from a “non-agreement” country, say India, China, or UAE can claim a 52 week exemption from National Insurance, in many cases. We guide clients on the most cost-effective structures.