Tax on overseas earnings while keeping family home in London

[Notsurewhattodonowattheend]

After 20 years at a tier 1, UK bank, DH lost his job along with his whole department. After a year of looking, he has found work overseas. It seems the city is shrinking and the city of London is no longer where the work he knows how to do takes place.

While it is not ideal, DH and our family are willing to be flexible. We’d like to keep our house, and some stability for our children. I will stay in London, I like my job and want to keep it. DH will work overseas, earn in foreign currency, pay local income tax and effectively send remittances home to help pay the mortgage.

What tax obligations does he have to the UK on the foreign income that he earns?

You probably need a financial adviser/tax lawyer.
It will depend on where he is tax resident.
If he has done self assessment in the past in Uk he will need continue to do it. He will need to make sure he doesn’t spend too much time in the Uk so he isn’t considered resident here.
The Uk is not like the US with tax. Once he leaves the Uk for residency purposes unless he taxable assets in the Uk he should not be taxed by the Uk on his income in the county where he is tax resident.

https://www.gov.uk/government/publications/rdr3-statutory-residence-test-srt

Start here to decide whether he is UK resident or not. Possibly not if he has full time contract abroad, but the devil is in the detail. Each (tax) year would need to be considered separately.

If he is UK resident, then look at the double tax treaty (if any) with the UK and that country. See where he would be resident under the treaty.

Then take tax advice.

It depends on where he is going to be working and the terms of the double tax treaty. Safest way to find out is to take tax advice from someone experienced in overseas employment. If he is going to be working for a large company that regularly offers work to those from the UK, then he may be able to get the information he needs direct from their HR department.

Given that he’s recently been a full time UK resident and will have a house, plus wife and children in the UK, he won’t be able to spend many days per year in the UK without being considered a UK resident for tax. Maybe only 45.

You’ll need specific advice depending on where he’s going and the tax there.

As he is employed overseas the tests don’t apply but he won’t be able to be in the UK more than 90 days and can’t work in the UK more than 30 days to be non resident

Otherwise he will have to file a uk tax return and check the double tax relief treaty between UK and country he’s working in

When I did this my employer sorted it all out. I was in Hong Kong but kept my house and husband in the UK.

He needs professional advice. Much of this depends on where he is going and whether there is a dual taxation agreement with the UK. Chat GPT may also be able to help with a first assessment.

He is a tax resident for 26/27 so long as he moves by 4 April 27. Depending on the DTA between the UK and the country he moves to he may be part year resident of UK from 5 April 26 until the day he leaves UK & enters new country or day his new country work visa starts. Then part year resident in the new country, it also gets complicated as most countries tax year is the same as the calendar year.

He should ask for a tax professional in his new country that work with British expats

If he’s joining another bank with an intentional presence, they should be able to advise on this; it’s a common occurrence in investment banking.

Thank you for all the good advice. I was wondering what the smart questions to ask were. Yes, the bank is offering advice, and he would also take independent advice.

At the moment, he is facing the offer and trying to understand what it is worth, net.