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Will foreign residents’ salary qualify for UK pension?
I have clients (husband and wife) who have become Spanish resident this year.
They are joint (50:50) shareholders in a UK company.
My question is if they continue to pay themselves a salary at the lower earnings limit (currently £533 a month) will it qualify for UK state pension credits?
Query 20,251 – Expat.
Non-resident principal private residence relief claim.
A client moved abroad for work purposes in the 2022-23 tax year and became non-UK resident with effect from 18 September 2022. Split year treatment was claimed under case 1.
He subsequently sold a buy-to-let property that he had owned for more than 20 years in October 2022, which had been his principal private residence for the first six years of ownership (all prior to 5 April 2015) and let thereafter.
When preparing the capital gains tax computation I rebased the property as at 5 April 2015 and I have subsequently only taxed the gain that arose post 6 April 2015, however I am unclear on the extent to which a claim for principal private residence relief can be claimed for the last nine months.
I found a number of articles online that suggest that a claim for the last nine months of ownership can be claimed provided the property has been the taxpayer’s main residence at any time regardless of whether the day count test is met, but the legislation appears inconclusive.
From what I can see, TCGA 1992, s 223(1) does not specifically exclude non-residents from making a claim but I was wondering if there was anywhere else in the legislation that confirms this.
I would be grateful for readers’ comments and whether I can therefore exempt nine months (9/90) of the gain post April 2015. Query 20,252 – Adviser.
VAT issues of selling farmland to a developer.
I act for a client who has received planning permission from the local authority to build houses on a few acres of his land, which is currently used by a tenant to trade as a farm.
The tenant pays my client monthly rental income for the site and no VAT is charged by my client on the rent.
My client’s plan is to opt to tax the site and sell the land to a developer, charging VAT on the proceeds.
Having only ever rented it out and not claimed back on any costs, I believe we don’t need permission from HMRC to opt to tax. Is this correct?
I have two further VAT questions. The development land is obviously clearly identifiable. Are we able just to opt to tax this parcel of land rather than the whole site? I have a recollection that you had to register all connected land as well but am not sure.
As part of the plan, my client will pay compensation to the farmer tenant for giving up their land.
Will the farmer charge VAT on this payment because he is also VAT registered?
Finally, would my client be able to reclaim input tax on the professional fees incurred in negotiating this settlement with the tenant as it effectively relates to the whole development? Query 20,253 – Giles.
VAT on used cars shipped from GB to NI.
One of my clients is a second-hand car dealer based in Manchester and has just arranged to sell three vehicles to a dealer in Northern Ireland.
I am very confused about VAT because – as I understand it from a colleague – there is different VAT treatment in each case, which seems strange.
- The first vehicle was purchased in GB in May 2023 for £12,000 ex VAT and there was no interest from any GB customer – hence why it is was sold to the NI dealer for £12,500 including VAT in September ie, at a loss.
- The second vehicle was purchased in GB in March 2023 before the new VAT rules took effect on 1 May 2023 for £10,000 ex VAT and was sold for £15,000 including VAT, again in September.
- The third vehicle was purchased in GB in July 2023 for £5,000 plus VAT from a VAT registered taxi business. It was sold to the NI dealer for £8,000 plus VAT, again in September.
Could readers tell me how much input tax and output tax my client should claim and pay in each case on his September 2023 VAT return please? Query 20,254 – Del Boy.
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