EUROPE | UK 47 TAXATION AWARDS 2021 If you wish to sell property in your home country, it may be advisable to do so before moving. If you plan to keep the property and rent it out, you should consider how the rental income would be taxed in the UK or the US after you become resident there. • Do you intend to work after moving and where will you be performing the duties of your employment? Consider how your income will be taxed, whether social security contributions may be payable by you and your employer, and what exemptions might be available with the right planning. If you own a business in your home country, the profits may become taxable in your new country of residence, regardless of whether you take a salary of dividends. With careful planning before you move, it may be possible to save some tax. • Both the US and the UK have an estate tax. If your assets have a total market value on the date of your death exceeding any exemptions that may be available, your estate will be taxable. Currently, both jurisdictions levy a tax at 40% of the estate, which can significantly deplete the value of your assets as you pass them onto the next generation. For many, this will be the most important consideration for long-term tax planning. • Are you the grantor/settlor or beneficiary of a trust? If so, you need to understand how trust income and gains are treated after you become resident and what tax-saving opportunities there may be with the right planning. • Finally, you’ll probably need to file tax returns once you have relocated. This is likely to be complicated and it’s important to ensure you’re fully compliant to avoid significant penalty exposure. What are the benefits of consulting an expatriate tax expert? The above list is by no means exhaustive, but it covers most of the initial questions to ask yourself if you’re planning to move to the UK or the US. The answers to those questions may lead to further questions, and you might even end up uncovering your most important challenges as you discuss your relocation with your tax adviser. Also, even after your relocation, your circumstances or the tax rules could change, which is why it’s generally recommended you retain the ongoing services of a good tax adviser, who’ll be able to keep you in the know regarding any changes that might affect you.
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