Understanding whether a client will continue to be resident in the UK and which country they intend to become tax resident in if they move overseas is an important part of the conversation for wealth managers.
Minesh Patel, an advisor at EA Financial Solutions in London, said: This is important. This is because inheritance tax in the UK is calculated based on the domicile of the beneficiary, not on the domicile of the beneficiary. Important considerations to understand a client’s home country are how many years they have lived in the UK in the last 10 years compared to the number of years they have lived abroad, and the country of origin of the client’s father is also important. is the determining factor. An individual’s tax address. ”
More broadly, he said advisers would need to understand the tax rules of that country if their clients were to become tax resident in that country rather than the UK. Obviously, if they become a taxpayer in another country, they will no longer be able to pay into a UK ISA and will only be able to make personal contributions as a pension.
A question that often comes up here is whether the client intends to continue to have a domicile in the UK, even if the client has moved primarily overseas. This is important because, for example, most investment platforms where advised clients may hold assets require a UK address. So if they don’t have it, an advisor task will be created for them. ”
Mark Pollock is a partner at Evelyn Partners and the head of the company’s expat clientele.
He said: “Many countries have tax treaties with the UK and understanding them will help you understand the tax treatment, so you need to know which jurisdiction they are moving into.” Ta. For example, if you have an ISA in the UK, what happens to the income you might receive from it, or if you have a pension, should you keep it or move it overseas?
“Then we look at the assets they currently own and plan to continue to own in the future. The key questions here are: Are clients who have moved abroad likely to return to the UK in the future? And I think it’s whether you want to keep some of the assets.” In the UK, if you only leave the country temporarily, you may have a tax liability if you return to the UK after a short period of time. ”
