Posted by Nick Day on 04 Dec 2014

Remittance Basis Charge Increase for Non-Domiciled

The Remittance Basis Charge (RBC) is an annual tax charge paid by non-domiciled individuals who wish to continue claiming the remittance basis of taxation once they have been UK tax resident for a number of years.  By claiming the remittance basis, non-UK sources of income/gain are only liable to UK tax to the extent they are remitted (brought) to the UK.

The current RBC is £30,000 per individual per tax year where the non-dom has been UK tax resident for 7 out of the 9 previous UK tax years, increasing to £50,000 where the non-dom has been UK tax resident for 12 out of the previous 14 UK tax years.

Following the Chancellor’s Autumn Statement the RBC is set to be increased.  It has been announced that from 6 April 2015, the start of the 2015-16 UK tax year, the £50,000 charge will increase to £60,000 per tax year for those non-domiciled individuals who have been UK tax resident for 12 out of the 14 previous UK tax years.  A new charge of £90,000 per tax year will be brought in for those who have been UK tax resident for 17 out of the previous 20 UK tax years.

It has also been announced that the UK Government will enter into consultation on whether making the election pay the Remittance Basis Charge should apply for a minimum of 3 years, so that in the Treasury’s own words; “non-domiciles are not easily able to arrange their tax affairs so as to only pay the charges occasionally”.

We have extensive experience of helping non-domiciled individuals arrange their UK tax affairs. Please click on the following links for a summary of the services we offer and related articles/guidance.

Contact Tax Innovations

If you would like any advice regarding the above article or would simply like to discuss other ways in which we could help you or your business, please contact us on 01962 856 990 or customerservice@taxinnovations.com.