I have obtained a new client who has a UK self assessment tax return to complete though he resides in Prague and has been there since Jan 2013 running his UK based business. Some income from the Czech Republic is paid into his UK business bank account together with other business income from the UK. Are there any special rules with regards to the foreign income as he is no longer a resident? I'd do some further research but it's that time of year. Thanks
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By UK business do you mean a UK company? Why is he even filling in a UK tax return, is it a property business? Anyhow, foreign income is not taxable if he is non-resident.
Does he do all the work from Prague or does he visit the UK to perform the duties? What does the DTT say about where the income is taxable? Does he even need a UK return? I suspect that he will be taxed on the SE income in Prague, but he should seek local advice.
There does not seem to be a trade here, though you may need to investigate further. If it were me, I would ring HMRC, advise them of the facts and ask them to cancel the notice to file a return. All assuming that the facts supported there being no UK trade - verifying that is the first step.
Then I would tell the client to seek local advice in Praha and declare the income there.
But
You still have not answered Portia's question. What does organising courses really involve? Are you sure he doesn't have a permanent establishment in the UK?
Control of the business (if there is indeed a business) seems to be being run entirely in Prague so difficult to see how there is a PE in UK. I would recommend you at last make time to read the PE rules in HMRC international manual.
So as Tim and Portia have said, based on limited facts, doubt this income is taxable in the UK.
James
I think you are taking Portia's name in vain! She said "A non-resident is only liable to UK tax on any trade carried on through a permanent establishment in the UK, which there may or may not be." As the questioner has not provided any details as to what is involved in 'organising courses' no one can give a definite opinion on the client's UK liability. (And, yes, I am fully aware of the rules on PEs).
Sorry Chicken Farmer but I
Sorry Chicken Farmer but I have no idea where you are coming from.
Both Portia and Tim have in my mind clearly said that if there is no PE then no UK tax.
I have stated that there does not appear to be a PE but that this opinion is also based on limited facts
I have also stated in my opening sentence, that this is on the assumption that there is indeed a business. Perhaps for clarity I should have added - "in the first place"
I am so glad you know the rules on PE as well!
It's the same time of year for every one yet some people have still taken the time out to at least point you in the right direction.
Presume you are unhappy because you haven't been given a full and frank answer.
It wouldn't take too much time to review the pages in the manuals and you might find the experience of researching and finding the answer quite rewarding.
If after doing your own research you were still unsure I am sure there are many people on here who would then have been happy to have helped you further.
I have a 3rd rule - get my work done so I can be safely tucked up in bed at 23.35 rather than still working!!
And before you ask I have a client base of over 4 figures!
Despite also being very busy myself at the time inthe end I tried to help you all be it with caveats because wether you like it or not, you didn't provide enough information to be able to give a clearer answer and in regards to the research I also gave you a pointer as to where to look for further help, given I have dealt with this area before. It didn't mean you had to drop everything there and then to do the research but at least you had been provided with pointers when you did have the time. And finally, as I also said, if you still needed help I and probably others would have been happy to oblige.
Don't work to hard today stroppy, sorry snoppy76!!