on my retirement I intend to liveaboard whilst floating around the world. Any information on income tax on pensions and income....the avoiding of would be appreciated.
No Im not a tax inspector just a guy trying to figure out how to survive on a meagre pension which the government want to tax even though Im not there.
The Inland Revenues attitude is that I will have to pay tax to some country. They have reciprocal arrangements with countries like France and Spain if you live as an ex pat .
My arguement is that I am willing to pay my dues to the places I live in ,which as a liveaboard would be through the various charges made in harbour dues,entry and exit fees even cruising taxes. I do not see why I should pay tax to support an infrastructure from which I would not benefit.
Am I alone in this...
The Revenue have a very good web-site relating to ex-pats. Included on this site is the information you need relating to income and pensions sourced from the UK.
From the information on that site you will get a very good idea of the options open to you /forums/images/graemlins/smile.gif
I've always understood that, as a british person I have to pay income tax on income arising this country - regardless of where I'm actually living. So I get a uk occupational pension - therefore have to pay UK income tax on it regardless. I looked into it some time ago and couldnt see a way round it - but would love to know if I missed something!
Is there not a tax threshold;withyour meagre income surely you would be below thisIn this society the taxes are foreveryone to pay,theoretically within their possibilites .Your harbour due dont cover road maintenence or schools etc from which you indirectly benifit.The only people who dont pay tax are the thr really,really obscenely wealthy! Joke
be a bit careful here as you may find that losing income tax, may also lose you the entitlement to index linking on your pitiful state pension. My parents (now living in Aus) have been caught by this.
Sorry for suspicions Snowball - hope I am forgiven!
For what it is worth, we held on to our accountant when we began living aboard in the Med five years ago. For his fee of about 120 quid a year, he (or his minions) forward a form for us to sign before he returns it to the Revenue. So far, he seems to be able to claw back a good proportion of our UK tax which has been deducted at source from occupational pension, interest etc. Much of this is due to tax allowances.
Why not check out a local accountant. It is not a difficult problem for them.
I would counsel against trying a DIY job My experience of trying to do it myself was about 20 years ago when I was renting out a house. I was pursued by them for two years for miniscule amounts. I think that the relationship a good accountant has with your tax office counts for a lot.
Of course, you, and only you, are responsible for what info arrives at the Revenue so I am always totally up front with my accountant.
Pause........whilst legions of accountant yachties get on to rubbish what I have said!
What was being referred to was the decision made a good few years ago that people who make themselves "Not Ordinarily resident" will continue to get their current level of pension BENEFIT but that it will be frozen at that level and not benefit from sucessive declared annual, other periodic increases in the level of the BENEFIT or "one - off" bonus BENEFIT payments.
If you believe that your existing ontribution record may render you unable to claim a full State Pension BENEFIT then you can made additional payments to make up the shortfall. Also, if you've made full contributions for a full working life you may be deemed to have made "Sufficient" contributions BEFORE reaching Normal Retirement Date and therefore stop making any further contributions. This happens to a lot of people around 60 years of age. To find out how your contribution record stands and therefore how much pension BENEFIT you will be entitled to, see this site to obtain a State Pension BENEFIT forecast.
Well, first of all we paid no tax last year as we had insufficient income to use up our income tax allowances. As has been stated already, income arising in the UK is taxed in the UK, and only if you have substantial funds offshore does it pay to go 'non resident'. And this has pitfalls.
If you are non resident, you do not get 'pension credits' if you are a male over 60, that may help you to attain a full pension. You can make class 3 contributions if you have a short fall.
There are other benefits for which you need to be, or appear to be, 'ordinarily resident'. The winter warmer allowance, for instance, and free nhs treatment more importantly.
If you have property, make sure one is your principal residence so that it might be capital gains tax free provided you establish residence before you sell it.
So take care about what you tell people, and research it first. By all means take advice from an accountant, but take care there also.
Finally, there are gruesome but unsubstantiated tales of people getting stuck in countries (e.g. Spain) and becoming liable for local taxes, even import taxes on their boats. So when you do go, don't let the grass grow on your bottom!
As an offshore worker- on ships, I used to use a specialist accountants called Seatax, based in Doncaster, who charged £75 a return I think it was. Made life far easier, until my usual guy retired and was replaced by... anyway, that's another story.
no deficit, they were 75 yrs old when they left UK, both with full pensions. As soon as they arrived in Aus, the pensions were frozen and no more cost of living increments applied. Their is a case slowly working its way to the european court on similar lines.
Fundamentally the tax man needs to know which country you are domiciled, from this he acepts that that country will tax you according to its tax rules. You cannot have no address or a mobile address; he does accept you will tour the world but unless some country taxes you (unless you are below its thresholds) then the UK man will tax you. Again, unless you are below its thresholds.
Thanks to all who contributed advice and information. It has cleared the muddy waters somewhat. As a new user I am impressed by the forum and the helpfullness of you folk out there. /forums/images/graemlins/wink.gif
Why not complete it yourself, on line, and save the accountant the trouble of filling the the numbers YOU'VE supplied. You'll then be £200, before tax better off.