HMRC launches remittance basis toolkit

Published: 12th October 2023

The remittance basis is available to those that are not domiciled in the UK. Where a claim is made (or the remittance basis applies automatically), non-domicile individuals may only be taxed on non-UK income and capital gains to the extent that it is remitted to the UK. The concept of a “remittance” is wide, and as such there are various risks and pitfalls that are often overlooked. For example, if the remittance basis is not claimed in one year, but income generated offshore in a year that the remittance basis is claimed is then remitted, the full amount will be taxable in the UK.

The new toolkit aims to help assess whether or not taxable remittances have been made. It is aimed at advisors, but is also a useful benchmark for taxpayers to refer to in terms of what documentation they will need to send to allow the advisor to check the position. The focus is on checking source documents, and areas of risk are outlined such as credit card usage. The toolkit helpfully contains links to HMRC guidance on various matters.