Moving to the UK - Tax Implications with LTC..

[FrozenWaves]

Hi Guys,

I have been working in the UK for the last 10 months. I left NZ in Jan last year and traveled for a few months before settling down in London.

My situation: LAQC holding 1 property that is CF Neutral at the moment. I plan to transfer it to a LTC (im currently back in the country on holiday and am looking at the paperwork at present). Director and 100% shareholder. Purchased in 2009.

My question is, do i need to become a Non resident? What are the tax implications of staying a resident or becoming a non-resident for tax purposes? I plan to be in the UK for the next few years at this stage. Can the director and shareholder be a non-resident?

Is an LTC the best way forward for me? I havent claimed a huge amount of depreciation over the last few years, but dont want to trigger depreciation recovered if i dont have to, hence the reason of transitioning to LTC.

Mortgage is with the BNZ, if i transfer to LTC, do i need to change any of the mortgage docs, based on a new structure?

Any help on this will be greatly appreciated.

Cheers,

Tom

[TheLiberalLeft]

As you've been in UK for 10 months, you're already a tax resident of Britain.

[drelly]

If you HAD an LAQC it will have already changed to a QC at the deadline in October

[FrozenWaves]

Thanks,
So is it too late to convert to a LTC now Drelly?
Yes i am a tax resident of the UK, im just unsure if that means i have to become a non-resident here in NZ as well, or can i be both?
Cheers

[spaceman]

You can be a tax resident of both and probably are....but NZ and UK have a DTA

http://taxpolicy.ird.govt.nz/tax-treaties

Cheers
Spaceman

[Wayne]

Thanks,
So is it too late to convert to a LTC now Drelly?

I believe you can have another shot next financial year for a few months but for this financial year you are a QC.

[FrozenWaves]

OK, so if im a tax resident of both countries, do i have to declare my UK income in my NZ company/property returns?
Thanks again, greatly appreciated.

[benz]

do i have to declare my UK income in my NZ company/property returns?.

I'm no accountant, but resident in UK and non-resident in NZ, where I have rentals in my own name. I'm not required to state my UK income on my 'non-resident' NZ tax return.

So my answer is, not if you're 'officially' non-resident in NZ

[spaceman]

^....what he said...but also...because there is a DTA it doesn't matter even if you aren't a non-resident, you'll declare it but won't get taxed twice

Cheers
Spaceman

[FrozenWaves]

Thanks Guys,

Not that keen to pay double tax. Looks like I will stay a resident of both, fill out my return as a QC this year and then next year switch over to a LTC structure.

Thanks again for all your wisdom!

[TheLiberalLeft]

I was the same as benz. I think that technically though, benz, you are supposed to list the NZ income on the UK return, but it's a hassle 'cos the YE dates don't coincide and it's a hassle proving the tax you've paid in NZ.

[benz]

I was the same as benz. I think that technically though, benz, you are supposed to list the NZ income on the UK return, but it's a hassle 'cos the YE dates don't coincide and it's a hassle proving the tax you've paid in NZ.

I do declare my NZ income on my UK return, though it has only been necessary the last 2 years.

Never had a problem with it in UK and surely if there's some doubt the 2 tax departments will talk to each other.