HMRC Admin 32 Response

Hi,

If you are referring to the transfer of funds from an overseas bank account to a UK bank account, such transactions are not in themselves liable to Income Tax. Any interest or dividends generated may however be taxable.                                        

Tax on savings interest

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Hi,

Article 17(3) of the UK/USA Double Taxation Treaty stipulates that payments made by one of the Contracting States under the provisions of its social security or similar legislation to a resident of the other Contracting State will be taxable only in the other Contracting State. As a resident of the UK, you should therefore declare your US Social Security pension in the foreign pages of your Self Assessment tax return. As no US tax will have been deducted from your pension, no Foreign Tax Credit Relief can be claimed.                    

Foreign notes (2022-23)

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Hi,

Please submit a fresh P85 , showing the correct total pay (ie including the sales bonus now received) for 2022/23.                                            

Tax if you leave the UK to live abroad

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Hi,

If you appeal against the late filing penalties by completing form SA370 , it will be clear from the information you provide what your residency position is.                

SA370 Appeal – Self Assessment: Appeal against penalties for late filing and late payment

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Hi,

“Stock dividends”, if they are traditionally structured bonus issues, are neither dividends (since nothing leaves the company) nor capital reductions, but rather reflect a capital reconstruction. 

Stock dividends as defined in the legislation are treated as income by virtue of S1049 CTA10 and, where undertaken by UK resident company, are taxable as savings income under S409 to S414 Chapter 5, Part 4 Income Tax (Trading and Other Income) Act 2005 (ITTOIA05).

However, there is no equivalent charge for stock dividend income from a non-UK resident company. Furthermore, the charging provision for dividends from non-UK resident companies (‘overseas dividends’) is quite different from the charging provision for UK dividends and other distributions at section 383 ITTOIA 2005. Section 402 ITTOIA 2005 is narrower, for example it excludes ‘dividends of a capital nature’.

This means that to be charged to Income Tax under S402 ITTOIA, something described as a “stock dividend” by a non-UK resident company would need to be a dividend of an income nature. It is the company law mechanism of payment that determines whether the payment is a ‘dividend’ or not (this is set out in more detail by the Court of Appeal in HMRC v First Nationwide. This case determined that whether an issue of share capital by an overseas company is chargeable to UK Income Tax, the primary question is whether the distribution is paid by a dividend mechanism. The dividend will only escape the charge to Income Tax if it is accompanied by a reduction in capital or paid in a liquidation). There is further guidance on the meaning of stock dividend at CTM17005, and a specific comment on ‘Dividend Reinvestment Plans’.

Applying this to the question raised here it is necessary to look at the exact mechanism being used to achieve any sort of “stock dividend” by a foreign company. If the transaction in question is a true “bonus issue”, then a SCRIP dividend will not give rise to a charge under section 402, ITTOIA 2005 for the reasons set out above – nothing has left the company and there has been no capital reduction. However, where alternative methods are used – such as the DRIP scheme you note in your query, it is possible that a dividend chargeable under section 402 has been received, but it always depends on the exact mechanism used in the particular jurisdiction.
               
CTM17005 - Distributions: stock dividends  

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Hi,

Nothing for tax puposes as there will be no change. You may need to check with your employer and/or the country you are going to see what they require.

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Hi,

As you will still be UK tax resident then there will be no change for for you.

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Hi,

You can contact us by webchat by clicking 'Ask HMRC online'

Self Assessment: general enquiries

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Hi kec,
If it is only UK interest that you receive and under £10,000 then no tax return is required. Foreign income needs to be declared.
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Hi,

If you are the nominated partner, you can do this by contacting our Self Assessment team by clicking 'Ask HMRC online' or writing to us.

Self Assessment: general enquiries

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