The following Private Client guidance note provides comprehensive and up to date legal information covering:
STOP PRESS: This Practice Note is being reviewed in light of the changes introduced by section 35 and Schedule 10 to the Finance Act 2018. For further guidance, see Practice Notes: Finance Act 2018—progress through Parliament and Changes to the taxation of offshore trusts from 6 April 2017.
As discussed in the UK resident non-domiciliaries—tax planning Practice Note, non-domiciled individuals resident in the UK can claim to be taxed on the remittance basis. This means that only their UK source income and gains and the foreign income and gains they remit to the UK are subject to UK taxation. Remittance basis users are therefore exempt from UK tax on foreign earnings that are kept outside the UK.
Until 6 April 2008, UK resident non-domiciled individuals were not taxed under section 87 or Schedule 4C of the Taxation of Chargeable Gains Act 1992 (TCGA 1992). In effect this meant that trust gains could be remitted to the UK by a beneficiary free of UK tax. This was amended with the introduction of Finance Act 2008 (FA 2008) though the scope of changes is limited by the reliefs afforded to non-domiciliaries.
There are three main reliefs:
exemption of pre-6 April 2008 capital payments and TCGA 1992, s 2(2) amounts, and
the remittance basis
The rebasing election does not allow 'rebasing' of
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