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How should expats access their online tax records?
The self-assessment deadline has now passed and I have turned my attention to loftier things, like the struggles faced by taxpayers living abroad.
I have become aware of an issue with which many expats seem to be struggling. Specifically, the lack of a UK address and the fact that not having one precludes you from accessing HMRC online services.
Fellow tax professionals have clients who are UK citizens who have relocated to other countries and they are struggling to access information about their pensions (such as pensions forecasts) and/or their tax affairs.
There are several options to verify one’s identity but they all rely on having a UK address (such as a credit check or a driver’s license).
Have other Taxation readers come across this issue and, if so, how have they resolved it? In today’s modern world of remote working, it seems farcical that UK citizens cannot access and manage their tax records online.
Query 20,287– Miffed.
Is my advice on university fees planning acceptable?
There’s been a lot of controversy recently about shares being gifted to children to fund school fees.
I’ve always been nervous about such arrangement but now I have started to worry about shares for university fees.
My opinion has always been that it was acceptable, in a family-owned company, for dividend-only shares to be created and transferred to adult children so that the children can take advantage of the dividend allowance.
My question is whether this is still acceptable or whether I will find myself under attack or investigation for giving unacceptable tax advice.
Some words of comfort, if they are appropriate, from other Taxation readers would be most welcome.
Query 20,288 – Educator.
Mitigating capital gains tax liability of late client.
For many years, I have dealt with the tax affairs of a woman born in South Africa.
After marrying a UK citizen she obtained dual nationality (ie she has South African and British nationalities).
Over 20 years ago the couple took up permanent residence in South Africa leaving their freehold property in the UK to be let through estate agents.
Sadly, her husband passed away during August 2017 leaving his wife as the sole owner of the property.
In September 2023, my client also passed away and the property will be sold shortly. I understand that this will inevitably attract a substantial capital gains tax liability.
The point that I would like to establish is whether the liability can be mitigated by way of concession or legislation considering that my client has been classed as non-resident in the UK for each of the past 20 years.
I would be obliged for readers’ comments.
Query 20,289 – Springbok.
Cash accounting scheme and group registration.
One of my clients was a member of a three-company VAT group which used the cash accounting scheme for VAT.
By mutual agreement, my client left the group and is now registered for VAT as a stand-alone company – the date of registration was the day after leaving the group.
Due to cash flow issues – paying creditors slowly – my client has not adopted the cash accounting scheme with the new registration.
However, I have just discovered that my client did not account for output tax – either through the group registration or current registration – on closing debtors of £80,000 plus VAT on the date it left the group.
My question is whether the group registration should have accounted for output tax on these sales on the day my client left the group – as the sales invoices in question showed the group’s VAT number – or whether it should have been included on my client’s first VAT return with the new registration ie, following through the principle of cash accounting.
What do Taxation readers think? All debtors have paid their bills, so there are no issues with bad debts.
Query 20,290 – Groupie.
New queries
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This is a free service but the editor-in-chief would be delighted if, in return, querists provided information on the ultimate settlement with HMRC of the problem areas raised in queries.
