Remittance basis means that if you don’t bring foreign earnings into a UK bank account, you don’t pay UK tax on it. This is a particular tax situation for UK residents who don’t consider themselves to be domiciled in the UK and have earned money abroad.
However, if you choose to claim the remittance basis, you will lose your UK tax-free allowances, and eventually you will also have to pay a special charge.
This charge starts at £30,000 a year if you’re a non-domiciled and have been resident in the UK for at least seven out of the previous nine tax years. After twelve years it goes all the way to £60,000.
Of course, you will still have to pay UK taxes on any income or capital gains you made in the UK.
Hey there! We really hope this article helped you. Tax matters can be a dreadful topic at times. We know. That's why we started TaxScouts.
A stress-free way to getting your taxes done.
Have a minute? See how it works