Tax deadlines have just been and gone for another year in the UK. If you’re muttering “Doesn’t apply to me”, I’m afraid you could be wrong. And you may be getting yourself into a spot of bother. So, please, read on.
New government focus
You see, according to tax expert Niresh Ramachandran of NEXES-HK, the UK government is increasing its focus on non-residents with UK income and assets who are failing to file their annual tax returns. The current political landscape (don’t say the B-word!) likely has something to do with the government’s focus on landlords and investors living abroad.
“If you own a UK property, have sold a property, received an inheritance, have UK shares or own an investment portfolio there, you need to file a return by 31 January each year – even if you live in Hong Kong or have been away from home for many years,” advises Niresh, before adding, “getting the right advice will save you money in the long term.”
In fact, even if you don’t have an income, you need to file a non-return. It might sound strange, but this is true. Failing to do so will incur a fine of up to £1,200 – one fine for each year you haven’t filed.
That sounds like a scary proposition if you happen to have forgotten to file. (And, with this magazine hitting shelves just a day after the 31 January deadline, it’s likely there are some readers in that situation right now!) Thankfully, Niresh has a reassuring tone and is very clear when he says, “It’s quite a serious oversight, but it is fixable. That’s why I’m here. I try to make it as simple and easy as possible. Everyone’s situation can be discussed and most can be easily resolved. Again, it’s fixable.”
Savings for UK landlords
Beyond advocating for those who are behind on their tax returns, Niresh is keen to point out that, with up-to-date guidance about allowable expenses, many clients can make considerable savings.
Niresh’s company NEXES-HK also works with Hong Kong-based investors looking at possible UK property purchases. His team liaises with a range of property developers and advises on tax liabilities for new purchases while also managing tax returns for UK landlords.
He explains that he often meets UK property owners in Hong Kong, many of whom use UK agents who take 20 percent for taxation on behalf of their client. He warns this is a common trap where many foreign landlords short-change themselves; in fact, they simply shouldn’t be paying this much tax.
“There are lots of changes happening with government taxes on property. A lot of people used to do it themselves, but now there are many who don’t understand all the allowances and benefits you can receive each year,” says Niresh. “That’s where NEXES-HK comes in; we’re up to date.”
If you’re looking for UK tax advice or guidance on a sale of a UK investment property, contact Niresh and his team at nexes-hk.com.
See more in our Finance section
This article first appeared in the February/March 2019 issue of Expat Living magazine. Subscribe now so you never miss an issue.