How to avoid paying tax

[Conachair]

I can see that they wouldn't care if you were abroad as long as you kept paying tax but did you ask what you needed to do for not res?

The tax paid was only for income arising from duties carried out in the UK. No UK tax was paid on any work abroad. I had researched the conditions before going to see them, 90 days per year in the country average over 4 years etc etc or whatever it was/is. No house, they weren't interested in a foreign address as I was on the boat. You become non resident on the day after you leave. there is a tax form to reclaim any tax owed (P85?) I think, I didn't fill out anything. But in my case, as the conditions were more than covered, becoming non resident was as easy as leaving the pontoon and heading south.

More from the horses mouth here.
http://www.hmrc.gov.uk/cnr/hmrc6.pdf

 

[KellysEye]

OK that's clear but I am now confused. We were told (and we read the document you posted) that you couldn't get not res not domicled the day after you left. I think you left a year after us so things migh have changed but from memory the document hasn't. On the other hand it doesn't mention the four year rule on a boat that we found out about. Oh well, all academic now but interesting, thanks.

 

[cheskamint13]

Great thoughts! Paying taxes is one of the biggest expenses. It is everybody's duty to pay however, the rich stay away from taxes through perfectly legal means. Why shouldn't you, if you suddenly have the facility? Here's how: http://personalmoneynetwork.com/moneyblog/2012/09/13/top-ways-rich-avoid-taxes.

 

[rotrax]

You need a few million quid in your pocket to be accepted as a Monaco resident as you do for Jersey and I think, Guernsey but the Isle of Man might be worth thinking about as a tax residency

A wealthy Czech Multi-Millionaire told me before he died that Monaco was chucking out all their millionaires.







It was to make room for the influx of Billionaires...........................................

 

[ffiill]

Personal allowances for a couple are now in excess of £20 k a year so I guess you must be on quite a good Pension for tax to be really meaningful?

 

[Matelot Joe]

You are right. Becoming non-resident cuts you off from the NHS and means you can't get an EHIC so you are on your own healthwise. In fact you can lose rights to NHS with an absence of only 3 months from the UK, although in practice this does not happen often - it is designed to stop "health tourists".

You also need to consider all the otheer long term benefits of being a UK taxpayer, such as rights to benefits and particularly state pension. Many people keep UK residency and maintain some form of UK address just to be sure that they can access these services in the future. If you have children that might want to go to University, they will become overseas students and therefore have to pay full fees without access to grants, loans etc

Six months is the limit, the last time I was told. There has been plenty of cases were people with major health problems have been refused NHS treatment. I have also seen it first hand experience of this in action as i live out of the UK parts of the year.
My advice is keep an address in the UK, Possibly with family of friend. I also echo the advice below. !..........
(Becoming non-resident is a major step and you need to be sure that you can support yourself long term with the resources you have.
Good professional advice clearly needed.)

 

[Sybarite]

We got not resident and not ordinarily resident for tax purposes. The problem is you can't get it quickly unless you have a fixed adress and are paying tax in another country. Clearly this is not on for cruisers. However, there is a four year rule. If you can prove you've been out of the country for four years with no fixed abode then you can apply for not-res, which we did. If you leave the UK in (say) March 2102 then you can make the not-res claim at the end of April 2016 and get a rebate for tax paid in the last four years. If you leave in (say) May you don't get back the tax paid in that tax year, although you will still get not-res. If possible use an accountant who has not-res experience. If you need a recommendation please PM me.

The key thing is not-res does not cover UK income, any income in the UK will still be taxed so move money/assets offshore. Don't use any tax haven in Europe, the European witholding tax on interest earned is now 35%. Move everything offshore before leaving the UK. Also there are moves afoot to not give non-res if you belong to a UK club and other trivial things so cut all ties.

Some countries will refund the withholding tax on interest and dividends if you are truly not resident, eg Germany.

PS This was the situation reigning some years ago. Things may have changed since.

 

[usernamenotvalid]

There is a reason the answer to this and similar questions are not blindingly obvious. If they were obvious, everyone that would in a position to avoid being taxed by this means would be doing it. And, if that were the case, the tax laws would change to prevent it. Which is also why people that have discovered loopholes for their personal, probably similar, situation will not be telling you of their solution on an internet forum. It does seem a pity that having paid taxes throughout one's working life that they're still looking to scrape a bit more out of you while you are essentially living on monies you "did without" whilst working. When you finally come to a solution that suits you, don't be surprised if the laws change shortly thereafter. The really wealthy can afford accountants that probably charge more per customer than most of us will ever have to live on in retirement. I know of one such "accountant" he flies to the US twice a year for a couple of weeks and as a result is a multi millionaire himself. He only has ONE client. Good luck with it.
Cheers John"

 

[Bav34]

Great thoughts! Paying taxes is one of the biggest expenses. It is everybody's duty to pay however, the rich stay away from taxes through perfectly legal means. Why shouldn't you, if you suddenly have the facility? Here's how: http://personalmoneynetwork.com/moneyblog/2012/09/13/top-ways-rich-avoid-taxes.

Newbie ... straight into The Lounge ... Holy Thread Revival Alert :nonchalance:

 

[KellysEye]

We were away for six and a half years and were both not resident and not ordinarily resident. If you have a fixed address then you can apply for it after you leave, if sailing you have to wait four years and you will get a tax rebate for what you paid before you left. This doesn't apply to you but if have let a house or have other earnings in the UK you will be taxed. Cancel any club memberships etc to prove you have cut ties. Move all your money offshore but not to European banks there is a 30% withholding tax on savings. Use an accountant to organise your not res status. Ask a relative to act as your post box and get all correspondence sent to where you are, obviously you need to tell anyone you deal with your new address. Check if you still qualify for a pension if you are not res and have no connections with the UK. If you need to know anything else please shout.

 

[sailaboutvic]

How to avoided paying tax ?
Die .

 

[macd]

How to avoided paying tax ?
Die .

:encouragement:
The two inevitables.

 

[rogerthebodger]

How to avoided paying tax ?
Die .

Even then you can't it called estate duty.

 

[usernamenotvalid]

How to avoided paying tax ?
Die .
Even then you can't it called estate duty.

Don't tell anyone they're dead. Then get relatives to hide the body.

 

[sailaboutvic]

Even then you can't it called estate duty.

Not if you know your on the way out .
(Hide the body ) only problem is it start to smell after a while .

 

[dslittle]

I know it is not good practise to post this on two forums but have asked the samequestion in Scuttlebook buthoped someone here may be able to help as no doubt there are others in the same position.

So I have worked all my life and paid my dues to any government agency which wants to take their slice from my wages.
We have now sold all our assets in the UK, moved aboard our boat and will soon be leaving the UK for good to cruise. At the moment we have no intentions of going back apart from the occasional visit.
Even though I am not using any resources they still tax my meagre pension.
I have heard of merchant seamen and even long haul flight staff paying a reduced rate of tax but is there any way I can reduce or even get rid of them taking my money. I can certainly spend it more wisely than they can.

You should have gone to one of the Retirement Seminars!!!

 

[FullCircle]

Great thoughts! Paying taxes is one of the biggest expenses. It is everybody's duty to pay however, the rich stay away from taxes through perfectly legal means. Why shouldn't you, if you suddenly have the facility? Here's how: http://personalmoneynetwork.com/moneyblog/2012/09/13/top-ways-rich-avoid-taxes.

Although possibly spam, I am leaving this for the moment, as it has informative suggestions for US forumites which 'may' or may' not' lead to chargeable services.

 

[temptress]

Look here for the forms, but get some professional advice it may be better for you to remain tax resident in the UK.

 

[mlthomas]

If you move out of the Country for more than 183 days isn't your pension removed from the index linking, so you gradually become worse off, and if you move back it goes back on the inflater but at the point you left? Might be wrong but I think I saw it on a programme about ex-pats living in Spain!
I would seek professional advice on all of this - sounds rather complex.
Only bad thing about the Isle of Man is the Irish Sea which is horrible to sail in!!

 

[roblpm]

I am a Chartered Tax Adviser fwiw.

I would suggest a sailing forum isn't the best place to get tax advice!!

A few hundred quid and a couple of hours with a tax adviser could save thousands in the future however it all depends on individual circumstances, what assets and income does the person have etc etc.

Lastly the points about the NHS and state pension are well made. It is always said that the tax tail shouldn't wag the dog.