Request a consultation on foreign income taxation

Do you need to declare foreign income in the United Kingdom?

If you are a tax resident of the United Kingdom, you are required to report all sources of income to HMRC, including income received outside the United Kingdom.

This could include foreign salaries, rental income, investments, dividends, pensions or any other income.

Consultant Legal Marketplace provides advice on foreign income tax in the UK, taking into account your status, double taxation and possible tax relief.

How is foreign income taxed in the United Kingdom?

The taxation of foreign income depends on:

1. your tax residence (determined by the Statutory Residence Test);
2. the method of taxation: arising basis (all worldwide income is taxed) or remittance basis (only income transferred to the UK is taxed);
3. the existence of double taxation agreements between the UK and the country of origin of the income.

We:

• analyse your tax status;
• help you choose the optimal tax regime;
• calculate the possible tax burden and help you apply for tax relief.

What documents are required for declaring foreign income?

For correct tax reporting, you need to collect the following information:

1. confirmation of sources of income (contracts, certificates, bank statements);
2. documents confirming taxes already paid abroad (if any);
3. financial statements in the case of business activities outside the United Kingdom.

Consultant lawyers:

• check the completeness and accuracy of documentation;
• analyse possible discounts and deductions;
• prepare tax advice or assist the client in submitting a Self Assessment.

What happens if you don't declare foreign income?

Failure to declare income abroad may result in:

• penalties from HMRC;
• additional tax assessments with interest;
• tax audits and loss of tax benefits.

That is why it is important to obtain professional advice before filing your tax return.