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  1. #11
    Join Date
    Mar 2014
    Location
    Bristol
    Posts
    495

    Default Re: Hold Over Relief / Resident Status?

    you have to look at the domestic legislation in the home and host countries concerned.

    If there is double taxation on the income or gains then you need to look to the international rules (i.e. the treaty) to see which country has principal taxing rights and which country will grant tax relief.

    Some countries honour their treaties others don't.

    In any case, we are drifting from the OP's questions. He needs to get comfortable with how his UK tax residence status affects the holdover relief and what he needs to do to either break UK tax residence or remain UK tax resident.

    Provided he moves around a lot on his circumnavigation it is unlikely he will become taxable elsewhere unless he holes up somewhere in a spanish marina for months on end.

  2. #12
    Join Date
    Mar 2006
    Location
    Manchester
    Posts
    17,388

    Default Re: Hold Over Relief / Resident Status?

    Quote Originally Posted by northcave View Post
    I wonder if anyone here understands the HMRC residency tests and might help with regard hold over relief after receiving shares? I wish to circumnavigate and take my time over it. I.e. more than a year without having to return to the UK.

    Here are some facts:

    1. My father passes shares to me in my family business as he is aging and wishes to do so in case he becomes incapable of making significant business decisions. I don't personally work in the business on a daily basis.
    My first thought is that, if you can remove the cause of the issue, that is possibly the solution.

    You say that your father is ageing, and wants to pass on the shares because he may not be able to make business decisions in the future. You dont work in the business on a daily basis, and plan to be out of the country for more than a year.

    1) Firstly I wonder how giving you the shares helps with the decision making stuff, as you are not there to make any decisions. Why/how does the ownership of the shares relate to the need to make business decisions. Even if you receive the shares, how do you plan to be involved in the decision making if you are out of the country on the high seas for over a year?... I could go on, but you will get the gist.

    2) You suggest that your father is concerned that his decision making ability is likely to deteriorate, but you only say, "in case". How likely is it that this will happen either during, or before, the end of your trip. Presumably he will sense that it is happening, before he loses said capability. Not wishing to be morbid but, apart from the fact that any of us could die at any time, is your father likey to pass away before you return?

    My point is that the transfer of the shares could be delayed until either you return from your trip, or an appropriate number of days before your return to the UK at the end of the trip.

    Having postponed the transfer, if your father were to sense an absolute need to transfer the shares before the above, cross that bridge when it comes.

    I keep wondering why transfer the shares to someone who has had, and will have, no involvement in the business, and wont be in a position to have any involvement for at least a year or so, if the reason for the transfer is an inability to run the business. Is this the real reason?
    Narrowboating From Stretford!!

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