I was born in Croatia but I’ve lived in the UK for 20 years. I recently inherited an apartment in Croatia which is let out. Do I need to pay tax in the UK on those rents, even though I don’t bring the money back to the UK?
As you were born in Croatia your home country is outside the UK, and you probably have the tax status known as ‘non-domiciled’. This is not certain as your domicile for tax purposes depends on a number of matters, including whether you intend staying in the UK in the future. If you are non-domiciled you may be able to ignore your overseas income for UK tax purposes, if the total income and gains left outside the UK each tax year amounts to less than £2,000. However, you must include on your UK tax return any overseas income or gains you bring into the UK, known as a ‘remittance’.
Where your overseas income and gains amounts to more than £2,000, you currently have a choice:
- pay an annual £30,000 tax charge and ignore your overseas income (which remains overseas) for UK tax purposes; or
- declare all your overseas income and gains on your UK tax return.
This a very complicated area of tax and you should discuss your personal circumstances with us before deciding what to include on your UK tax returns.
