[adZ]

Hi All

I have recently been presented with an opportunity to transfer to HK from the UK. I am still in the early stages of negotiation with my employer and am doing some preliminary research to find out whether the move makes financial sense.

I have spent sometime reading through the posts in this forum but haven't found any information regarding Double Taxation and the inland revenue site is unclear. I was hoping someone be able to clarify the situation for me.

If I was to move to HK with a local package, would I still be liable for UK 40% tax as well as HK 16% tax in my first year?

Additionally if I was to sell my apartment here would I still have to pay CGT if I tell the IR that I am leaving the country to go work in HK?

Thx
adZ

[KnowItAll]

Dont' know anyone here in HK who pays UK taxes (including the wife) while working and living here.

There might be some subtle issues that I'm unfamiliar with. I'll let the other members chime in.

[berryplucker]

No - you wouldn't be liable for two lots of tax - you would be treated on a partial year (pro rata) basis in each place.

There is no UK Capital Gains Tax on the sale of your primary residence in the UK.

[kevin]

berryplucker is correct, no double taxation if you are non-resident. To quote the IRS “If you remain resident in the UK for UK tax purposes, normally you will be taxable on your income arising in the UK and overseas.” If you become non-resident, you will normally only be taxable on your income arising in the UK.

So it really depends on your residency status. As long as you inform your Tax Office and ask for a form P85 and leaflet IR138 telling them you are leaving and you are taking a full-time job abroad you can be a non-resident. Basically you need to be out of the country more than 182 days in the year to qualify as non-resident and therefore not liable to UK tax.

Check out http://www.inlandrevenue.gov.uk/nonresidents/ for lots more info

You are still liable to tax on income arising in the UK however, such as rental income from your flat if you choose to rent it out rather than sell. In practice you can claim enough expenses against the rental income (up keep, trips back to check the flat etc) that you would not pay tax but you must make a declaration.

[adZ]

Thanks for your input guys ... this certainly is good news.

adZ