Tax-Efficient Planning for Individuals Returning to the UK

The Challenge

Our client, born and domiciled in the UK, had been living abroad since October 2019. Now considering a return to the UK and in the process of purchasing a property, they owned assets both in the UK and overseas. They were concerned about the potential UK tax implications of their return, including capital gains, dividend income, and property-related taxes.

The Solution

We conducted a thorough review of the client’s UK tax residence status. Based on this, we provided tailored advice which included:

• Identifying when they would become UK resident and planning for this to ensure that the temporary non-residence rules did not result in any unforeseen tax liabilities arising on return to the UK.
• Realised chargeable gains on overseas assets before their UK return to manage capital gains tax exposure.
• Strategically timed dividend payments from their UK companies ahead of becoming UK resident again, optimising income tax liabilities.
• Advise on Stamp Duty Land Tax (SDLT) implications related to the planned UK property acquisition, including non-resident surcharges.
• Supported the client with the disposal of other UK properties, addressing issues Capital Gains Tax (CGT) and 60-day reporting

The Value

Through proactive planning, the client was able to:

• Minimise their UK tax liabilities on overseas gains and UK dividend income.
• Effectively navigate SDLT costs on their new property purchase, avoiding unexpected surcharges and benefiting from lower SDLT rates.
• Manage the disposal of UK properties with clear tax guidance on non-resident SDLT and CGT, ensuring compliance and optimising tax outcomes.
• Ensure that tax liabilities were not crystallised on historic disposals.

Our client returned to the UK with confidence, equipped with a strategic tax plan that aligned with their complex international situation.