From: "tim" <520010973502removethis@t-online.de>
Newsgroups: uk.finance
Subject: Re: Offshore account with debit card - Where?
Date: Sun, 22 Aug 2004 21:41:54 +0200


"Ronald Raygun"  wrote in message
news:YsJVc.4367$on3.52883475@news-text.cableinet.net...
> BabyRabbit wrote:
>
> > The tax benefit is that, because I am not UK tax resident, I can spend
> > money outside the UK without being liable for income tax on it.
>
> If your tax status confers that benefit, then it will do so irrespective
> of where the funds are held.

Not quite.  If the funds are held in the UK then it is first taxable in
the UK, you claim a refund of that tax from the IR, which may not
be the full amount paid, then declare the income in the country of
residence (assuming it has a worldwide income rule which most do)
have someone work out how much tax is due taking account of any
double taxation relief available on the UK interest unrefunded (which
much advice I've had says is none, but I've reason not to believe
that advice) and then hand over the rest.

Personally I'd rather not have to jump through so many hopos to
stay honest in my country of temporary residence given that I don't
want to take the risk of converting the money into Euro (or
whatever) before investing it.  It's thus unsuprising that many
people living in a foreign country don't declare they investment
income from their home country to their host country

Of course if your total UK income is less than the personal
allowance you can fill in the form to have interest paid gross
in the UK and make the system much simpler, but if this isn't
the case I believe that you cannot use this form and you are
stuck with the above.

I will be really happy if somone thinks that I am wrong and can
show me a better way

tim





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