"Many UK nationals working in the UAE, Kuwait, and Saudi Arabia are looking to return home. However, being in the UK increases the likelihood of being classified as a UK tax resident under the Statutory Residence Test (SRT)."
"Being tax resident means they will be liable for UK taxes, which include a 24% tax on their worldwide income and gains for the duration of their UK tax residence. This could affect their Middle East salaries as well."
"If someone becomes a UK tax resident again, even if only for 1-2 years, and then returns to the Gulf, their estate may be subject to a 40% UK Inheritance Tax (IHT) if it exceeds £325,000 at the time of death."
"Individuals who only moved to the Gulf region a few months ago and have not yet become 'non-resident' in the UK will find that benefits-in-kind, such as free housing or a company car, are subject to UK tax."
UK nationals returning from the Gulf states may face tax implications due to the Statutory Residence Test. Being classified as a UK tax resident subjects individuals to a 24% tax on worldwide income and gains. If they return to the Gulf after becoming tax residents, their estate may incur a 40% Inheritance Tax if it exceeds £325,000. Benefits-in-kind may also be taxed if individuals have not established non-residency. Temporary non-residence rules may apply for those who spent less than five tax years abroad.
Read at London Business News | Londonlovesbusiness.com
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