Tax on your UK Income if you Live Abroad

Tax on your UK Income if you Live Abroad

You usually have to pay tax on your UK income even if you are not a UK resident. Income includes things like:
  • pension
  • rental income
  • savings interest
  • wages
If you are eligible for a Personal Allowance you pay Income Tax on your income above that amount. Otherwise, you pay tax on all your income.
 
The country where you live might tax you on your UK income. If it has a ‘double-taxation agreement’ with the UK, you can claim tax relief in the UK to avoid being taxed twice.
 
You do not normally pay tax when you sell an asset, apart from on UK property or land.

When Tax is not Due or is Already Deducted

Non-residents do not usually pay UK tax on:
  • the State Pension
  • interest from UK government securities (‘gilts’)
If you live abroad and are employed in the UK, your tax is calculated automatically on the days you work in the UK.
 
Income Tax is no longer automatically taken from interest on savings and investments.

When to Report your Income to HMRC

You usually have to send a Self Assessment tax return if:
  • you rent out property in the UK
  • you work for yourself in the UK
  • you have a pension outside the UK and you were UK resident in one of the 5 previous tax years
  • you have other untaxed income
You do not need to report your income to HMRC if you have already claimed tax relief under a ‘double-taxation agreement’.

Sending a Self Assessment Tax Return

You cannot use HMRC’s online services to tell them about your income if you are non-resident. Instead, you need to:
Fill in the ‘residence’ section (form SA109 if you’re sending it by post) to tell HMRC you are non-resident. Fill in any sections relating to your type of income.
 
You will be fined if you miss the deadline - it’s earlier if you are sending your return by post (31 October).

If you Have Overpaid

Apply for a refund if you think you have paid too much tax. This might happen if tax is deducted automatically (for example by your bank) but your total UK income is below your Personal Allowance.
 
Send form R43 to HMRC, or claim the refund in your Self Assessment tax return if you are already doing one.
 
Get help from a professional (like an accountant) if you need advice.

See Also:

For further information: