Non-UK Resident Tax Implications
by Nick Parker, RSM Tax and Accounting Limited
Non-UK Resident Tax Implications
If you are a non UK resident, you may be able to reclaim a proportion or the entire 20% withholding tax attached to the interest paid. If you have income from one country and are resident in another, you may be liable to pay tax in both countries. To avoid this the UK has negotiated double tax treaties with numerous countries.
To check if your country of residence has a double tax treaty with the UK please click here.
Please check the column titled “Interest” to see what the double tax agreement states. The basic rate of UK income tax is 20% – so if (for example) the treaty rate is 15% then the excess of 5% tax is repayable if a satisfactory claim is made.
Please note that to be considered resident, you must be a resident in the country in which the UK has a double tax treaty with, and must be subject to tax on the income in question in your country of residence, to be eligible to complete the form.
After successful completion of this form, HMRC should authorise any payments going forward to be applied at the appropriate rate of tax depending on the Double tax treatment with your country of residence.
Once confirmed that there is a double tax treaty for your country of residence with the UK, please follow the steps below:
Step1
Once you have made your initial investment, you are in a position to complete the form.
Step 2
Click on this link, to take you to HMRC Double tax relief home page
Step 3
As stated above there is a double tax treaty in place with your country of residence, you will have to complete the specific form. This form can be found by searching the country after DT- Individual which will be prepopulated in the search bar . For example search “DT- Individual New Zealand” if you are a resident in New Zealand. Please note, if you cannot find a specific form for your country of residence, you can access the default form by clicking here.
Step 4
Complete the relevant form and include the amount of interest received (gross) and the total amount of tax withheld in Part D of the form using the narrative “Interest paid by CaptialRise on investment”. Please then indicate in Part E which bank account you would like your repayment to be issued to, as it will be made via a BACS transfer from HMRC. Attached to the form, there are some explanatory notes to assist you in completing this.
Step 5
The form requires authority from your country of residency to prove that you live there. Please therefore send the completed form DT- Individual form to your tax authority. Once this has been processed they will either issue the form back to you, or send to HMRC directly with confirmation that you are tax paying resident. The repayment will then be processed and sent via BACS to your nominated bank account.
Assistance and Professional Advice
If you require any assistance in completing this form, please contact HMRC on +441355359022 if calling from outside the UK, and 0300 200 3300 if calling from the UK. If you wish to seek professional advice in completing the above forms, please contact Nick Parker at RSM Tax and Accounting Limited via email: nick.parker@rsmuk.com
CapitalRise does not provide tax advice and encourages investors to seek advice from an accountant and/or tax advisor.
