money from foreign country

Hi, I am staying in UK with spouse visa. I have a saving insurance in a foreign country, and if I terminate the insurance and withdraw the money back to UK, do I need to pay tax for this money? If it is the case, how will the tax be calculated? regards, Kevin

Hi,

You can see guidance on the taxation of gains on foreign life insurance policies here:       

HS321 Gains on foreign life insurance policies (2020)

Thank you.

Hi, Thanks for your advice. It seems that the gain from insurance should be taxed. However, since the insurance was purchased in foreign country, so I will receive the gain in currencies other than pound. How can I report this gain in pound?

Hi,

The gain would be reported in a Self Assessment tax return, in the foreign section.  

Under the terms of Self Assessment, HMRC does not provide an official exchange rate and the onus is on the individual to use a just and reasonable exchange rate at the time of the gain, You would need to convert the gain to pounds sterling. HMRC does have a record of exchange rates HERE:

Exchange rates from HMRC in CSV and XML format.  

You can use any of the rates it provides or you can use exchange rates from other sources, for example, the London stock exchange or those rates reported in newspapers.

Thank you.