HMRC Admin 32 Response

Hi,

No. Your wife does not need to inform HMRC of anthing at this time. There is no tax liability resulting from your wife inheriting a share of the property. In the future, when your father in law passes away, you wife will inherit a further share of the property. From a UK tax perspective, your wife would only need to declare the disposal of the property and any gain arising from the disposal, when she disposes of her share of the property.

Thank you.

Hi Jane,

The double taxation agreement between the UK and Portugal, gives Portugal the right to charge capital gains tax on the Portuguese property disposal, first. However, HMRC still has the right to tax your world-wide income and capital gains. This in itself would result you paying tax on the same gains in both countries, double taxation would be the result.

To ensure that this does not happen, you would need to claim tax relief of up to 100% of the capital gains tax paid in Portugal, which would be set against your UK capital gains tax liability. This means that you do not pay the tax twice.  

If you need to submit your 2022 to 2023 tax return without claiming a foreign tax credit, because you don't know how much Portuguese tax needs to be paid, then you could amend your 2022 to 2023 Self Assessment Tax Return at a later date.

Thank you.

Hi,

You would use the gross figure for dividends, which is the net figure plus witholding tax on SA106. Column D is the witholding tax Column E is to claim foreign tax credit relief and colum F is the gross figure.  

Have a look a the note for box 5 on page FN6.  

Foreign notes (2022-23)

Thank you.

Hi Kelvin,

Box 34 is for the income that you choose not to remit to the UK in that tax year (box 35 for capital gains). A breakdown of the income and gains, is provided in box 40. All other income is declared for tax purposes.  

If you never remit the income and gains to the UK, then it will never be taxable. However, if you remit the income/gains to the UK in a future tax year, the income and gains will be taxable in that future tax year.

Thank you.

Hi,

Each currency conversion is applied at the time the transaction arises. For enhacement expenditure, you would convert this using the a fair and reasonable exchange rate in place at the time the enhancements took place.

Thank you.

Hi,

Have a look at the guidance below, regarding pensions paid in arrears.  

EIM75020 - The taxation of pension income: pension payments made in arrears or in advance

Where the payment of the arrears results in more tax being paid in the year of the arrears payment, than would arise in the tax years the arrears relate to, you can contact HMRC asking for the payments to be related back to the relevant years.

Thank you.

Hi,

For the tax year 2023 to 2024 the AEA will be £6,000 for individuals and personal representatives, and £3,000 for most trustees. For the tax year 2024 to 2025 and subsequent tax years the AEA will be permanently fixed at £3,000 for individuals and personal representatives, and £1,500 for most trustees. The measure also fixes the CGT proceeds reporting limit at £50,000.

Reducing the annual exempt amount for Capital Gains Tax

The self assessment criteria would be 1, is a tax return required for any other reason and 2, is the disposal value over £50000.  If yes to both questions, then the gain must be declared in a tax return, regardless of the type of asset disposed of.

Thank you.

Hi,

In the UK, by default, income and Capital Gains Tax is calculated using the 'arising basis' on world-wide income and gains. Some individuals, can elect to use the remittance basis, to declare income that is not remitted to the UK and so is not included for tax calculation purposes. Unremitted income, must be declared on a Self Assessment Tax Return in the tax year that the income arises (SA109) as it will be taxable in a later tax year if remitted to the UK in that later tax year.  

Have a look at section 9 below for more information.

Residence, domicile and the remittance basis: RDR1

Thank you.

Hi,

Although this income is not taxable in the UK, it is still technically world-wide income, so, in the interests of full disclosure, you may choose to mention it in the additional information box 19 on SA100.  

Thank you.

Hi,

If you have overpaid into the pension, then you need to declare this in a Self Assessment Tax Return, so that the overpaid element can be charged to tax.

You would need to submit SA100 (tax return) and SA101 (additional information) on page Ai4 under pensions savings tax charges, boxes 10 and 11.  

You can register for self assessment below, if you have never registered for self asssessment before.

Check how to register for Self Assessment

Thank you.