Among UHY’s wealth management services offered globally by UHY member firms for international clients is Private Client Services, London, UK, which supports individuals in their personal tax affairs when they develop UK interests.
Partner Jeremy Herridge, who heads up the operation, moved to London from the Isle of Man where he developed expertise in offshore and international tax planning.
“Our typical clients are private individuals, executives and employees, including high-net-worth individuals and entrepreneurs," says Herridge. “We also offer services to companies sending employees to the UK."
Practical needs of clients worldwide moving to the UK include consultancy on residence, domicile issues and tax compliance.
For example, if clients plan to go to the UK with the intention of spending more than an average of 90 days per tax year there, they risk becoming ‘tax-resident’ on arrival – with significant implications for tax payments.
‘Domicile’ has a technical meaning for tax purposes, and is not the same as residence or nationality. It is not easy for a client to change his/her domicile, but it can be done if they make their main home in another country and make a firm decision to keep it there permanently or indefinitely.
If they are UK-resident, but non-UK domiciled, they can apply to be taxed on a ‘remittance basis’, which means they will not be taxed on non-UK income and gains if they leave them outside the UK.
The benefits of getting it right from the outset are significant: once clients have been UK-resident for at least seven of the previous nine tax years, they would need to pay a charge of £30,000 to claim the remittance basis, or else pay tax on their worldwide income and gains.
Similarly, benefits may accrue from limits on salary tax in the UK. A client’s salary for working in the UK will generally be taxable in the UK regardless of residence status, but if he/she is also resident in another country, there may be a tax treaty with the UK that limits the UK tax.
If a client will be working in the UK, and also outside the UK, it may be possible to arrange affairs so his/her non-UK work is not taxed.
Within Private Client Services’ portfolio:
- A UK property developer wanted to take advantage of a downturn in the property market to take a long holiday in Malta and cash in on some of his investments. UHY’s firm in Malta, UHY Pace, Galea Musù & Co, helped him take advantage of the country's favourable remittance rules to extract profits from the UK with significant tax advantage.
- A client wanted to expand his food wholesale business into mainland Europe. Private Client Services advised him on a tax-efficient holding structure for the business. UHY’s firm in France, GVA, advised on the establishment of a French company and how the transactions with the UK should be structured.