HMRC Admin 17 Response
Joined: 1/20/2021
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RE : 401K tax liability as UK National/Resident (non-US person)
Hi ,
For current legilsation, There is no legislative definition of a Lump Sum but HMRC regards these as being any non-periodic payment of a pension -
That is, any non-regular payment that decreases the value of the remaining pension pot after such payment is made.
For example, the first (IRA) withdrawal is taken in year
1, the next withdrawal was made in year 5, and another withdrawal in year 7; such payments will not be regarded as periodic and will be treated as Lump Sum’s under the UK/USA DTA.
Whereas any amount withdrawn in set, periodic, frequent intervals (e.g. weekly, monthly, annually etc.) would not be a Lump Sum, but rather periodic payments.
Article 17(2) of the UK/USA DTA provides the US with the right to tax any Lump Sum payment which is made from a US sourced pension scheme (including IRAs).
However, the UK is also permitted to tax the same lump sum payment(s), which is in accordance with Article 1(4) of the DTA .
Thank you . -
RE: CGT on Sale, Joint owners confusion
Hi ,
You will take your half share of the purchase price from 2005 and then you will take the 1/2 value in 2012.
As the 2012 was bought between you and your partner you are taking 1/2 of this to add to your orginal purchase price from 2005
as you now own 75% of the property.
Your partner owns the other 25% ,
Thank you . -
RE: Accidentally paid in more than £20,000 in one tax year to 2 cash ISAs
Hi ,
You can .
Thank you .
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RE : Split Year Treatment Case 3
Hi ,
It will be the January as you are still the legal owner of the property until then .
Thank you . -
RE: Different ratio split on rental income for co-owned property
Hi ,
Thanks for your question.
As TSEM9170 - Ownership and income tax: legal background: ownership income follows property - variation
refers, in certain cases, ownership and income may vary from the actual ownership split.
You are correct, owners may agree a different split of profits, however, we would expect expenses to match such split.
Thank you . -
RE : Question about non-residential property expenses in Hong Kong
Hi ,
Thanks for your question.
As per PIM4702, a section is contained titled tax credit relief which may assist within your query as taxation can apply in both states.
In terms of expenses incurred, you may claim for the management fees paid to the management company, rates and government rent paid every three months as this is a requirement to be able to rent out the property.
In relation to question 3, if the leasing commission paid covers a first letting or sub-letting for more than one year then this would be deemed of a capital nature, so not allowable, PIM2120 refers:
PIM2120 - Deductions: main types of expense: legal and professional costs & :
PIM4702 - Rent from property outside the UK: Income Tax (IT) .
Thankv you . -
RE : On Buy to Let Mortgage
Hi ,
Thanks for your question.
Yes, you may claim mortgage interest to offset against rental income, which shall be restricted to the basic rate as per the following link:
Tax relief for residential landlords: how it's worked out .
Thank you . -
RE: Different ratio split on rental income for co-owned property
Hi ,
Thanks for your question.
Although it is not necessary to approach a solicitor, it may be beneficial to seek legal advice to ensure all aspects are covered.
Thank you . -
RE: Share of expenses for live in landlords
Hi ,
Thanks for your question.
As per PIM4030 attached for your convenience, outlines what Method A & B are, as well as showing examples to determine which option would be beneficial for yourself.
If claiming rent a room relief, expenses cannot be claimed against rental receipts as shown in PIM4001 also attached:
PIM4001 - Rent-a-room: overview and
PIM4030 - Rent-a-room: receipts above exemption limit .
Thank you . -
RE: Tenancy in Common to Joint Tenants
Hi ,
Thanks for your question.
I would advise when changing perms of ownership to send in a covering letter outlining the date the change occurred so both records
may be updated accordingly to assist with any future queries you may have.
Thank you .