Wednesday, 13 August 2014

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Expats could be forced to return home under new government tax proposals affecting rental property in the UK.

  The plans, forwarded by the Chancellor George Osborne, would see the removal of personal tax allowance privileges for overseas residents who also claim income in the UK. If the Chancellor goes ahead with the plans, couples drawing a government pension could also face a £4,000 (€5.000) cut in their yearly income, forcing many to return home. UK government pension plans are only taxable in Britain, meaning that former civil servants living abroad could see a rise in their tax obligations.

Under the current system, expatriates and EU nationals have UK-earned income offset with a personal tax allowance of £10,000 (€12.570), but the planned reforms could jeopardise those expats who live under a carefully considered budget. Up to 400,000 expats could be affected by the proposals which would inject the treasury with an extra £400 million (€503 million) a year.

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