An interesting one…
Harry has been resident in the UK but domiciled in the USA for 9 years.
He was horrified by the prospect of paying the £30,000 non-dom tax, just as he
reaches retirement. We were able to find that under the terms of the third break
clause in the UK/USA International Tax Treaty, from June of this year Harry is
treated as Resident in the US only.
Hooray for Harry!
However, when I start Harry’s tax return it transpires that the charge for using the
remittance basis for 6 April to 1 June is £30,000. There is no pro-rating.
Horror for Harry!
When I look further into Harry’s unremitted foreign income, even though this is
substantial, the charge for two months is much less than £30,000.