The Chancellor has confirmed that his controversial proposals for the taxation of people resident but not domiciled in the UK and others benefitting from the remittance basis of assessment will become effective from 6 April 2008.
Key last minute changes included:
• De minimis increased to £2,000 a year
• £30,000 charge will not apply to minors
• £30,000 will be allocated as a payment in respect of unremitted income and gains, allocable by the tax payer and available for credit when such income and gains are remitted
• £30,000 will probably now qualify for tax treaty relief
• More exclusions for assets brought into the UK
• Employees who are resident but not ordinarily resident in the UK and receive shares or options as part of their remuneration will be liable for UK income tax on such employment-related securities (ERS).
ERS gains derived from non-UK employment duties will be subject to income tax on the remittance basis.
This will also apply to non-doms where the ERS income relates to a foreign employment, the duties of which are performed wholly outside the UK.
