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Old 20.07.2011, 14:48
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Swiss Tax implications for transferring money to the UK

Hi guys & gals
I'm currently debating on whether to take advantage of the cheap pound and send some money back to the UK.
Does anyone know of the tax implications of transferring around 50'000 CHF back to the UK ?
I'm a Swiss tax resident (still with a base in the UK) so wondered if I would still have to declare this money, even though it's in the UK, in my next Swiss tax return ? Also would I be liable for paying any taxes on it in the UK ?

Thanks for any pearls of wisdom that you may have.
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Old 20.07.2011, 15:29
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Re: Swiss Tax implications for transferring money to the UK

As part of your world-wide assets this money should continue to be declared on your Swiss tax form as part of your 'wealth' (Vermögen).

AFAIK there is no restriction or tax on exporting money from CH or into the UK, or visa versa...
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Old 20.07.2011, 15:33
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Re: Swiss Tax implications for transferring money to the UK

Be very careful.

As far as I know, if you still own property in UK, the CHF 50,000 will be considered unearned income! Better ask an accountant first, or transfer it to a bank in Jersey. You could also simply open a sterling account here.
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Old 20.07.2011, 16:03
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Re: Swiss Tax implications for transferring money to the UK

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As far as I know, if you still own property in UK, the CHF 50,000 will be considered unearned income! Better ask an accountant first, or transfer it to a bank in Jersey. You could also simply open a sterling account here.
It shouldn't be considered unearned income. I assume that this money has either come from earned income or unearned income, but that it has already been taxed once (in Switzerland).

As AbFab pointed out, you will need to continue to declare this money on your tax return so that the appropriate wealth taxes can be deducted. If the money is in an interest-bearing bank account, you should make sure that it is paid GROSS, then the interest declared on your Swiss tax return.

I'm not quite sure what 'having a base in the UK' means -- and this makes a difference. Have you told HMRC that you are no longer domiciled in the UK? (eg, do you pay all your taxes here in Switzerland and nothing in the UK? Or do you continue to owe taxes in the UK?)

If you still have tax liabilities in the UK, you should make sure that interest on the sum is paid NET and that appropriate UK taxes are withheld.
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Old 20.07.2011, 17:09
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Re: Swiss Tax implications for transferring money to the UK

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I'm not quite sure what 'having a base in the UK' means -- and this makes a difference. Have you told HMRC that you are no longer domiciled in the UK? (eg, do you pay all your taxes here in Switzerland and nothing in the UK? Or do
If the OP has a base in the UK, he has never left the UK as far as the IR are concerned & should continue to pay taxes on his world wide income in the UK as well as CH. Tax paid in CH will be credited towards his uk Liability.

UK Domicile is not something you loose easily & does not mean the same as domicile in Switzerland..

There is no additional tax to pay purely by remitting money to the UK.
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Old 20.07.2011, 17:19
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Re: Swiss Tax implications for transferring money to the UK

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I'm not quite sure what 'having a base in the UK' means -- and this makes a difference. Have you told HMRC that you are no longer domiciled in the UK? (eg, do you pay all your taxes here in Switzerland and nothing in the UK? Or do you continue to owe taxes in the UK?)
Careful there ... the term "domicile" means something quite different in the UK from Switzerland.

In the UK, it is your place of origin (e.g. Scotland / India / etc.) which is very hard to change unless you emigrate permanently (and then there are some more conditions too). In Switzerland, my understanding is that it means your main place of residence.

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If you still have tax liabilities in the UK, you should make sure that interest on the sum is paid NET and that appropriate UK taxes are withheld.
Look at the HMRC website to see what the conditions are for filling in a form for receiving interest income without tax deducted at source. Bear in mind that if you're an EEA citizen, you should still get a personal (tax-free income) allowance each year so the first bit of income is not subject to UK tax anyway.
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Old 20.07.2011, 17:31
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Re: Swiss Tax implications for transferring money to the UK

The UK tax you pay may depend on whether you're 'resident', 'ordinarily resident' or 'domiciled' in the UK. You can be more than one of these - or none.

http://www.hmrc.gov.uk/cnr/simple-gu...-residence.pdf

http://www.hmrc.gov.uk/cnr/hmrc6.pdf

'Leaving' the UK means you don't still have the following:-

"• Family ties include having a spouse, civil partner, children or other family
members you are close to, in the UK.
• Social ties include membership of clubs and societies and events that you
regularly attend or host. It also includes any regular recreational engagement,
such as returning each year for an annual sporting season.
• Business ties include owning or being a director of a business based in the
UK, or having employment, including self-employment, in the UK. Regular
employment duties in the UK are a tie and you need to consider the extent,
frequency and nature of those duties. It does not matter if the duties
themselves are not taxed, for example because of a DTA.
• Property ties include a house or apartment that you own or lease, or property
held primarily for investment but that also provides you with accommodation
when you are in the UK. A house or apartment provided for your use for the
duration of your time in the UK as part of an employment package is
‘available accommodation’ and is a tie to the UK."
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Old 20.07.2011, 17:50
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Re: Swiss Tax implications for transferring money to the UK

In any case, there is no additional tax that arises from moving the CHF50'000 from Switzerland to the UK.

The question about whether you are subject to taxation in CH vs. UK is to understand where any interest earned in the UK account would be taxed.

If you move the money to a non-interest-bearing account, there should be no additional tax due in either case.

Last edited by Village Idiot; 20.07.2011 at 23:33.
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Old 20.07.2011, 19:17
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The OP is probably subject to taxation in both countries, many people are!
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Old 20.07.2011, 20:42
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Re: Swiss Tax implications for transferring money to the UK

How would the UK tax people know anything about it, as you are not required to declare your wealth or bank accounts in the UK??

Also I would open an offshore account in sterling to avoid withholding tax. Like http://www.lloydstsb-offshore.com/ if you are a UK non-resident...
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Old 20.07.2011, 20:59
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Re: Swiss Tax implications for transferring money to the UK

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How would the UK tax people know anything about it, as you are not required to declare your wealth or bank accounts in the UK??

Also I would open an offshore account in sterling to avoid withholding tax. Like http://www.lloydstsb-offshore.com/ if you are a UK non-resident...
I'm pretty sure that you can be both domiciled and resident in Switzerland and yet own a property in the UK without paying UK tax on that property, so long as tax is paid in Switzerland on the UK property, and the property provides no income in the UK.
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Old 20.07.2011, 21:24
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The law was clarified by a case in the high court. Somebody who lived abroad had a tax bill going back 20 years. He had a house & daughter at boarding school, that was enough for him to have never left the uk.

Uk tax is self assessment it's upto the taxpayer to pay what is due without being asked.
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Old 20.07.2011, 21:28
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It's not just tax on the uk property it's your world wide earnings that may be subject to uk taxation as well as CH . If you left the uk & did not sell up everything & really leave You have not left the uk, the revenue guidelines were of no help to the taxpayer who had followed them to the letter for over 20 Years. The uk is on trouble expats are an easy target.
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Old 20.07.2011, 21:37
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Re: Swiss Tax implications for transferring money to the UK

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It's not just tax on the uk property it's your world wide earnings that may be subject to uk taxation as well as CH . If you left the uk & did not sell up everything & really leave You have not left the uk, the revenue guidelines were of no help to the taxpayer who had followed them to the letter for over 20 Years. The uk is on trouble expats are an easy target.
Isn't there a double taxation treaty between the UK and Switzerland?
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Old 20.07.2011, 21:53
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Indeed there is however you pay top up tax to the highest taker, that would be the uk. Ahv /avs payments are not deductible in the uk for a start. The 40% band kicks in around 50k chf ! So many people will be caught

It's fairly clear if you. rented your uk property when you left rather than sold , that your leaving was only temporary & you intended to return at some point . Escaping CGT is now very difficult as it required 'leaving' for at least 5 tax years not the previous 1.

All in all, very bad news to many who don't even realise the issue.
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Old 20.07.2011, 22:07
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Re: Swiss Tax implications for transferring money to the UK

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Indeed there is however you pay top up tax to the highest taker, that would be the uk. Ahv /avs payments are not deductible in the uk for a start. The 40% band kicks in around 50k chf ! So many people will be caught

It's fairly clear if you. rented your uk property when you left rather than sold , that your leaving was only temporary & you intended to return at some point . Escaping CGT is now very difficult as it required 'leaving' for at least 5 tax years not the previous 1.

All in all, very bad news to many who don't even realise the issue.
It is indeed a very complex and complicated situation and no place for amateurs.
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Old 20.07.2011, 22:27
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Re: Swiss Tax implications for transferring money to the UK

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Hi guys & gals
I'm currently debating on whether to take advantage of the cheap pound and send some money back to the UK.
Does anyone know of the tax implications of transferring around 50'000 CHF back to the UK ?
I'm a Swiss tax resident (still with a base in the UK) so wondered if I would still have to declare this money, even though it's in the UK, in my next Swiss tax return ? Also would I be liable for paying any taxes on it in the UK ?

Thanks for any pearls of wisdom that you may have.
UK taxes are on the remittance basis, but because CH has a double taxation agreement with the UK, if you paid taxes when you earned the money in CH then you won't be liable to UK taxes and don't have to include it on your UK tax form as long as you are non-resident.

As someone else said, you need to declare you worldwide assets and income on your tax forms.
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Old 20.07.2011, 22:48
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Re: Swiss Tax implications for transferring money to the UK

According to the detailed document linked above by fatmanfilms it may be more complex than that. It seems there may be a choice about remittance or arising basis, it seems that funds remitted to uk may be retrospectively taxed if you return within 5 years and are considered temporarily non resident. I won't pretend to understand all the complexity, which on a first read appears to be stated many times over with slightly different slant each time. But the OP is recommended to try and wrap his/her head around it. I've been away 10years plus and never more than a few days per year and have no resident dependents etc. so for me I think things are clear...i'm buying the GBP !
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Old 20.07.2011, 23:03
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Remittances based tax only applies to non dooms , ie people who were not born in the uk & also whose father was not born in the uk . Loosing uk domicile is complicated & takes many years to loose, having been away for 17 years & visiting less than once a year I am on the way.......
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Old 20.07.2011, 23:24
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Re: Swiss Tax implications for transferring money to the UK

The easiest and safest way to benefit from the low pound is to open a sterling account at your local Swiss bank, and the UK tax man doesn't need to know.
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