As of 6 April 2017, you can now be treated as UK deemed domicile, even if you aren’t domiciled in the UK under English common law. This will apply where either condition A or B is met.
This is likely to catch British individuals who have previously left the UK, acquired a non-UK domicile and then returned to the UK at a later date. These individuals will be considered deemed UK domicile from the tax year they become a UK tax resident again.
This will apply to individuals who have been UK tax residents in 15 out of the preceding 20 UK tax years.
Where an individual who is deemed UK domiciled under condition B leaves the UK, it will take six consecutive years of non-residence for them to lose their deemed UK domicile status.
The effect of the legislation means that the UK deemed domiciled individual is taxed in the same way as a UK domiciled individual under common law. This means that the individual will pay UK income tax and capital gains tax on their worldwide income and gains.
It is worth noting that the automatic remittance basis can still apply to individuals considered deemed UK domiciled, and therefore, it is essential to review an individual’s level of overseas income each tax year.
This can be a complex area, and one HMRC are very interested in, so if ETC Tax can be of any assistance, please do not hesitate to get in touch with us.
