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Topic: Something I read below has me a bit confused.....  (Read 1280 times)

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Something I read below has me a bit confused.....
« on: June 30, 2006, 07:45:01 PM »
With regards to wiring money from my US bank to my UK bank, and those funds being treated as remittance as if I earned them in the UK and therefore taxable.  Is that true?  I've probably wired 50K USD so far and was planning on having the proceeds of my US house sale wired to the UK.   That will be a sizeable amount for which I'm taking the US one time tax exemption.  Is there something I should be looking out for, and if so, is there anything I can legally do about it?  BTW, I'll be self employed in the UK.
Thanks in advance,
Bruce


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Re: Something I read below has me a bit confused.....
« Reply #1 on: June 30, 2006, 07:59:34 PM »
I think I may have gotten some of the answers to my circumstance.  According to HM Revenue and Customs IR139, any lump sum of pension earned soley outside of the UK isn't taxable.  I essentially have that as part of the funds, and what I've been wiring in.  Still don't understand about the house proceeds though.  Any help would be greatly appreciated.
Cheers,
Bruce


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Just found the answer to my question! I think......
« Reply #2 on: July 01, 2006, 06:01:52 PM »
HM Revenue and Customs site is quite helpful.  Capital gains on personal residence are not taxable, if meeting all the conditions.  That's in the UK.  I would assume that the same would apply for property sold in the US.  Need a bit more investigating, but I'm feeling happier now  :)
Cheers,
Bruce


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Re: Something I read below has me a bit confused.....
« Reply #3 on: July 02, 2006, 10:08:59 PM »
Hi there - there is a whole bunch to sort out here.

1. You say your wife is British, so she is presumably domiciled in England & Wales.  You are American and presumably domiciled in a US State (I do not know which one).  Has your domicile been agreed by HMRC?  If not I recommend you go ahead and get this dealt with.

2. As you say gains on sale of a main residence are exempt from UK tax. Lump sums from non-UK pension plans are only non-taxable by concession (not UK law).  However I suspect that you may meet the terms of the concession.

3. Remittances are only relevant if you are domiciled outside of the UK.  Your wife is taxable on worldwide income and gains from the date she returned here (assuming she lived with you in the States). 

4. If you have (as it sounds) mixed up your money in the US so capital gains, interest income, exempt gains on sale of a residence etc are all muddled together, then you may find that you are taxable on the item that generates the most amount of UK tax.  Unless you have segregated income from capital then you may have a problem (your wife's life is easier since she'll be taxable here anyway whether or not remitted to the UK).

5. I do not know if your wife has a US visa or green card, but you really need dual UK and US tax advice so you can both properly minimise exposure to both sets of taxes.


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