Foreign Income on SA

Foreign Income on SA

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Client with a  property income from New Zealand.  Property was bought several years ago and made losses until last year but expect to make income this year.  Client is registered as Non-Resident for Tax purpose with NZ Tax authorities.  I understand that there are arising and remittance basis to account for these in the UK.  What would be the best treatment for such scenario, especially when client doesn't intend to live in the UK permanently but has been tax resident for the past 2 years and have been filing SA returns with no foreign income/losses info?

My question - can the prior year losses be carried forward to this year even though they were not declared earlier or should it be declared in full and nothing brought forward from prior years.  I am interested from other experienced professionals re the residency and foreign income tax position.



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By David Treitel
10th Sep 2011 19:28

The previous returns are wrong as there was more than £2,000 of gross income.  You have an ethical obligation to correct these under the guidelines of whichever body you belong to.

The answer you seek will follow once the returns are corrected.


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Accountants & Business Advisers
By Gladstone
11th Sep 2011 00:38

There was no income from property for the last 2 years


There was no income from property during the past 2 years and client says that he called HMRC in the first year re guidance but was told that if he declares loss from overseas property he will not be able to claim anything from UK income but in future, that losses from overseas property can be set off against overseas income or he can choose not to disclose the foreign loss from property.  Client decided not to declare on the assumption that he wanted to return to NZ and didn't want to complicate things.  But this year client expects the property will generate a small income equivalent to £950 and concerned about UK tax position. To add further, he is filing NZ non-resident tax return every year and this year he'll have to pay taxes overseas too.


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