Hi All!
I'm researching UK tax rules around remittance basis taxation and can't seem to find definitive answer to two specific questions.
Background:
I'm planning to move to the UK in the next month or so and use split year and remittance elections. In the UK, I will have a full time job with UK employer (i.e. UK tax withholdings and after-tax amount deposited into UK bank account). In addition, I have a side consulting business in the US (US LLC taxed as disregarded entity that has solely US clients). While I won't be taking any new clients, I will continue providing consulting services to the existing US clients (will be billed through the US LLC and deposited to US bank in that US LLC name). I'm also planning to open a fresh Interactive Brokers (IB) brokerage account in the US (before I leave) - i'm planning to deposit my UK after tax earnings (from UK bank account) into IB account for investing purposes.
Questions:
1. Considering that the UK money will be after-tax (i.e. I'll pay UK tax on the wages and deposit after-tax money into the UK bank account before it goes into IB brokerage account), does it mean that these deposits are considered "clean capital" for remittance purposes? If so, if the money is invested in the US, does it mean that it falls under the remittance rules (i.e. realized gains and investment income is not taxed until remitted into the UK)?
2. Does the Consulting income fall under the remittance rules (i.e. if deposited into the US bank account and never remitted to the UK, then it's not taxed in the UK)? I found some articles saying that consulting income fall under remittance rules if earned first 3 years, but I didn't see any definitive guidance other than Overseas Workday Relief, which doesn't 100% apply in this case.
I'd greatly appreciate if someone could provide links to guidance on the above two topics.
Thank you!
