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Expatriates Newsletter

            Summer 2011             

 
 
Expats Newsletter 
This issue covers the subjects of: Tax, Pets, Financial Services, Properties, Education and Immigration.
 
 
 

TAX

Taxation for Non-Domiciled Individuals ("Non-Doms")

Expatriates normally fall - for tax purposes - in the "Non-Doms" category (see the Tax page for further details). In broad terms, this currently allows those expatriates meeting the requirements of the Non-Doms taxation regime to be taxed on their foreign income and capital gains on a "remittance basis" (i.e. only if the funds are remitted to the UK). During 2008 a number of restrictions were introduced to the taxation regime for Non-Doms, noticeably including limits on the time expatriates can enjoy the "remittance basis" without being taxed (currently, after a number of years, non-doms need to pay a £30,000 charge every time they still want to claim the remittance basis).
 
The UK Government recently released a consultation document whereby it is proposed to introduce some changes to the taxation regime for Non-Doms starting from the tax year 2012/2013 (i.e. as from 6th April 2012). Amongst these, some of the proposals that might be of interest to expatriates readers are:
 
  • It is proposed that the remittance basis charge be increased from £30,000 to £50,000. This, however, shall also be accompanied by the introduction of a longer term during which Non-Doms can avoid such charge (the newly proposed test is if a Non-Dom has been a UK resident for 12 or more of the 14 years prior to the year of the claim).
  •  
  • It is proposed to introduce new rules to enable Non-Doms to remit funds to the UK in exemption of taxes if such funds are utilised for investment in specific types of business.
  •  
  • It is proposed that sums held within a personal bank account in foreign currency (i.e. not Gbp) will not be in the scope of capital gain tax
 
Expatriates that have a Non-Doms status, may want to discuss their personal circumstances with their tax advisor in order to have a better understanding on how these proposed changes might affect them. The consultation period will run throughout the second part of this year and, hopefully, some draft legislation should be available well before April 2012.
 
 
 
 
 
 
 
 
 
 
 
Did you know that expatriates can claim child benefits, regardless the level of their income? Visit our  Child Benefits page
 
 
 
Would you like to read more about Taxation of Non-Doms?  Visit our Books Store page.
 
 
 
Do you need information on the cost of living in the UK? Visit our Cost of living & Salaries page
 
 
 
 
 
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PETS

Good News for Expatriates Travelling with Pets

The Department for Environment, Food and Rural Affairs (DEFRA) recently released some news which will surely be welcomed by those expatriates which are travelling with pets.
 
"The UK will harmonise its pet movement rules with the rest of the European Union from 1 January 2012, bringing the UK’s Pet Travel Scheme into line with the most recent science".
 
"Forcing pets to spend six months in quarantine, a practice dating from the 1800s, is no longer necessary because of vastly improved rabies vaccines and treatments. All pets will still need to be vaccinated against rabies. Pets from the EU and listed non-EU countries such as the USA and Australia will no longer need a blood test and will only have to wait 21 days before they travel. Pets from unlisted non-EU countries such as India, Brazil and South Africa will be able to enter the UK if they meet certain strict criteria to ensure they are protected against rabies, including a blood test and a three-month wait  before they enter the UK."
 
DEFRA also published a leaflet "Bringing Pets in the UK After 1 January 2012", where expatriates can find useful information. Expatriates can also review Pets page, where they will find additional information and links to the DEFRA website.
 
 
 
 
 
 
 
Are you interested in a checklist of things to do before you move to the UK? Visit our  Before you Move page.
 
 
 
 
 

FINANCIAL SERVICES

Moving and Foreign Exchange Planning

Mr Neal Hartley of Personal FX, a specialist in foreign exchange solutions, writes for our expatriates audience an article on the subject of relocating to a new country and the related foreign exchange planning.
 
Moving to a new country can be a daunting experience that inevitably involves a tremendous amount of fact finding and planning. The importance of foreign exchange is for some reason often overlooked. I am not talking about simply opening a bank account in your new country but the ongoing process of managing currency transfers between your originating country and where you are going.

Many people are guilty of ignoring the potential impact of fluctuations in the foreign exchange. This is often not a conscious decision as there are many other things to arrange but a lack of understanding as to how much difference currency exchange can make to a person’s income and lifestyle.

Dramatic market movements and volatility of up to 10% is not uncommon. Uncertainty over the weaker than expected global recovery and the Euro sovereign debt crisis have left traders with a particularly bleak outlook. The last six months has witnessed unprecedented levels on the prices of oil, gold and the Swiss Franc and other traditional ‘safe havens’ within the global market as investors seek solace. In short, this leads to more uncertainty in the currency markets.

The UK has a predominantly service based economy which includes banking. When the financial crises erupted, demand for the UK’s services was greatly reduced leading to a volatile future for the pound. Factors including a fall of interest rates, GDP, jobs, house prices to name but a few have led to some uncertain currency trends. The UK does not have the advantage of being able to rely on other market sectors to bolster its strength. Unlike Australia, New Zealand and Canada, who can look at natural resources and commodities to help stabilise their own currencies. Or China, whose manufacturing sector has seen rapid growth over the past decade.

The people moving money internationally rarely comprehend just how much of a dent this can make on their personal wealth. If moving £10k to US, a 10% move either way can mean the difference of $1000. Needless to say this principle is magnified with larger volumes.

Difficulties within the Eurozone and the sovereign debt levels of Greece, Italy, Portugal and Ireland still very much in the limelight, more volatility is almost a certainty for the next 6 months. The UK and US have both seen their austerity measures implemented but the recovery of both economies will no doubt be slow, marred with uncertainty.

The position individuals find themselves in does not need to be all doom and gloom. Clients can protect themselves from currency movements if they utilise the expertise of foreign exchange specialists. They have tools available to fix exchange rates for up to 12 months giving you peace of mind. Of course fixing exchange rates for 12 months can be used to keep a rate in an advantageous position making your money go further.

Contact Personal FX on +44 (0)20 7743 7073 to speak to an expert about your own foreign exchange strategy.
 
 
 
 
 
 
 
Do you want to know more about Foreign Exchange? Visit our Currency Converter page.
 
 

PROPERTIES

London Rents Rise to Record Highs

During July 2011, Knight Frank released information on the London rent market indicating that this has reached new highs. In a news release the property adviser reported that prime London rents have been rising 15% year-on-year, underlying that rents have been rising for 22 consecutive months, and now stand 1% above their previous peak in March 2008.
 
Expatriates should be aware that, according to the report from Knight Frank, demand for good properties in London is outstripping supply, thus boosting rents. An increase in demand from those working in the financial and professional services was also noted, as well as from European expatriates relocating to London to escape turmoil in their own country.
 
Expatriates can find further details in the News Release from Knight Frank.
 
 
 
 
 
 
 
What about housing? Visit our Housing (Buy or Rent ?) page.
 
 

EDUCATION

A University Place at Oxford or Cambridge ("Oxbridge")

During July 2011, an interesting report was released by The Sutton Trust on the subject of gaining admission to Oxbridge. In a news release it was reported that four schools and one college (Westminster School, Eton College, Hills Road Sixth Form College, St Pauls School and St Pauls Girls) sent more students to Oxbridge over three years than 2,000 schools and colleges across the UK.
 
Expatriates can find further details in the "Degree of Success" report issued by The Sutton Trust.
 
 

The North London International School "Open House"

The North London International School will organise, during October 2011, "open house" events where parents and children will be able to visit the Upper School and the Lower School. 
 
Expatriates can find further details in the NLIS website under "Upper School Open House" and "Lower School Open House".
 
 
 
 
 
 
Do you want to know more about education in the UK? Visit our Education page. 
 

IMMIGRATION

the UK Opens Its Doors to Exceptionally Talented Individuals

On 20th July 2011, the UK Border Agency reported that the Government will encourage exceptionally talented leaders in the fields of science, humanities, engineering and the arts to come to the UK.
The UK Border Agency stated that the new Tier 1 (Exceptional talent) category will open on 9th August 2011 and that this new category will facilitate not only those expatriates who have already been recognised but also those with the potential to be recognised as leaders in their respective fields. There is a limit of 1,000 places in the first year of operation. There will be 500 places available between the 9 August and 30 November and a further 500 places available from the 1 December to 31 March 2012. The number of places will be reviewed at the end of March 2012.
 
The UK Border Agency also reported that Tier 1 will be overseen by world-renowned 'competent bodies', which will advise the UK Border Agency on these 'exceptionally talented' expatriates to ensure that they are the brightest and best in their field. Expatriates seeking entry to the UK under Tier 1 will not need to be sponsored by an employer, but will need to be recommended by one of the competent bodies.
 
Expatriates can read the full news release on the UK Border Agency's website.
 
 
 
 
 
 
 
Do you want to know more about working in the UK? Visit our Working page. 
 
 
 
 
Expats Plaza is the website for the Expatriates living in the UK