HMRC writes to ‘Non-doms’ about the remittance basis

Practitioners who have signed up to receive corporate communications from HMRC should have received an email from HMRC advising them of their latest campaign affecting non-domiciled clients who are taxed on a remittance basis. On 24 July HMRC announced that they will be writing to all remittance basis users who paid the remittance basis charge in 2011/12 to:

 ‘help individuals understand what a remittance is so they can complete their tax return accurately’

The letters will enclose a fact sheet providing examples of remittances to the UK. Copies of both the letter and the fact sheet can be viewed on the following links.

http://www.hmrccorporatecommunications.co.uk/_/app/emailRobot/-
index/click/secret/f0bc30d0e75fa247fdca937b98045fab?attachment=840

http://www.hmrccorporatecommunications.co.uk/_/app/emailRobot/index/click/-
secret/99d86f246a634d03bc0c24a4bfe35a20?attachment=845

This is a complex area and although the fact sheet provides examples of general areas where there may be a taxable remittance it does not set out details of all the exceptions and reliefs available to remittance basis users.

It is important to note that copies of these letters will not be sent to the individual’s tax advisor. It also remains to be seen whether HMRC’s focus on the above mentioned remittance basis users will result in enquiries for those individuals. Tax advisors should use these letters as an opportunity to talk to their clients about past and future remittances. Where anomalies are discovered in past returns, no doubt, advisors will want to declare these to HMRC before an enquiry is made. Where future remittances may be made, it may be possible to structure these in a tax efficient manner.

For further advice on what may constitute a taxable remittance and general planning for non-doms please contact TaxDesk on 0845 4900509 and ask for Priya Dutta.