off shore tax declaration

Discussion in 'UK Finance' started by Dan W, Jul 30, 2004.

  1. Dan W

    Dan W Guest

    I propose opening a Co-operative Bank (Guernsey) 'Save Direct
    Worldwide' account for the purpose of transferring substantial
    proceeds from the sale of my main residence house in the UK (I do not
    own any other properties). The funds will be in the account for about
    6 months before i withdraw them to buy another house.

    My questions are, will i need to declare the interest to the Inland
    Revenue in my tax return and will i need to declare the funds
    (including interest) when i bring them back into the UK in 6 months
    time? I am British and work full-time in the UK.

    Many thanks.
     
    Dan W, Jul 30, 2004
    #1
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  2. My questions are, will i need to declare the interest to the Inland
    Yes.

    and will i need to declare the funds
    You will need to convince the recipient bank as to the legitimacy of the
    funds.

    Given that you will be repatriating the funds there seems little advantage
    in the transaction anyway other than deferring the payment of some tax.
     
    Peter Crosland, Jul 30, 2004
    #2
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  3. Dan W

    Doug Ramage Guest

    Yes, the interest is taxable in the UK, normally by reference to the date(s)
    of payment. I assume it will be paid gross?

    The opening of the account does not need to be disclosed to the IR.
     
    Doug Ramage, Jul 30, 2004
    #3
  4. Dan W

    dp Guest

    My questions are, will i need to declare the interest to the Inland
    Unless you want trouble. The Inland Revenue receives details of all
    substantial transactions through UK banks. They will certainly scrutinise
    anything substantial that also passes through a CI account.
     
    dp, Jul 31, 2004
    #4
  5. Dan W

    dp Guest

    Oops, I meant British banks not UK banks
     
    dp, Jul 31, 2004
    #5
  6. Dan W

    Doug Ramage Guest

    Yes, the interest is taxable in the UK, normally by reference to the date(s)
    of payment. I assume it will be paid gross?

    The opening of the account does not need to be disclosed to the IR.
     
    Doug Ramage, Jul 31, 2004
    #6
  7. Dan W

    John Bishop Guest

    What's the difference?
     
    John Bishop, Jul 31, 2004
    #7
  8. Dan W

    john boyle Guest

    From July next year (a date which may slip) a 'retention' tax at 15%,
    rising to 35% in due course, will be deducted from CI & IOM accounts
    held by EU residents, 75% of which will be sent to the Revenue of the
    country of residence, although the account holder can opt instead for
    the deposit taker to advise the IR of the gross amount of interest paid.
    The OP's dosh should be out of the account by then of course.
     
    john boyle, Jul 31, 2004
    #8
  9. Dan W

    dp Guest

    Oops, I meant British banks not UK banks
    Not much, but Guernsey is British but not part of the UK.
     
    dp, Aug 1, 2004
    #9
  10. Dan W

    Chris Blunt Guest

    Any idea how they propose to determine which customers are "EU
    residents"? Will it be based on the nationality of the account holder,
    or simply on the address that they have on record? If, as I suspect,
    they base it on the latter, there seems to be a huge loophole there
    just waiting for everyone to jump through.

    Chris
     
    Chris Blunt, Aug 1, 2004
    #10
  11. Dan W

    Kevingr Guest

    ISTR reading somewhere that it may be by tax documents. So if you
    claim to be UK resident, you would be asked to produce an appropriate
    certificate from the Inland Revenue.

    K
     
    Kevingr, Aug 1, 2004
    #11
  12. Dan W

    Chris Blunt Guest

    In that case I can see major problems in getting such documentation
    from the tax authorities in countries that don't issue such
    certification.

    Chris
     
    Chris Blunt, Aug 1, 2004
    #12
  13. Dan W

    john boyle Guest

    Their 'Know your customer' rules for Money Laundering are now more
    strict than here and a retrospective exercise has been conducted.

    It isnt nationality, its residence.
     
    john boyle, Aug 1, 2004
    #13
  14. Dan W

    john boyle Guest

    Like where? The EU Savings Tax Directive is pan European (and a bit
    beyond) and is being adopted throughout Europe, albeit with some local
    variations and all have signed up to it.
     
    john boyle, Aug 1, 2004
    #14
  15. Dan W

    Chris Blunt Guest

    I was thinking about developing countries such as where I live in the
    Philippines. The tax office here is absolute chaos and its difficult
    enough to get even straightforward regular transactions carried out.
    I'm quite certain that if I were to ask for some obscure tax
    certificate which they'd never heard of to show my overseas bank I'd
    get nothing but blank looks. I'm sure there are dozens of countries
    like that.

    If, on the other hand, its was simply a question of satisfying the
    offshore bank of my residence status, then that would make things a
    lot easier.

    Chris
     
    Chris Blunt, Aug 2, 2004
    #15
  16. Dan W

    john boyle Guest

    It is the latter.
     
    john boyle, Aug 2, 2004
    #16
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