From our partner Altexis, independent fiscal law firm registered at the Paris Bar:
The British government announced a reform of the definition of tax residency with respect of the principle of “Remittance Basis”. Currently, tax residents in Great Britain who are not domiciled or not ordinarily resident are not taxed on foreign source incomes when not remitted in Great Britain.
The proposed bill would restrict the scope of the Remittance Basis:
- A person not domiciled in Great Britain for more than 7 years would continue to benefit from “Remittance Basis” if paying a lump tax of £30.000. If not he would be taxed on his worldwide income even when not remitted in Great Britain.
This rule would apply as of April 6th, 2008.
For the computation of the 7 years of tax residency test, previous years of tax residency would be included.
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