If proposed changes in the pre-budget report would be accepted, UK Expats who are non-resident in the UK would have to start being more careful about how many times they travel back and forth to Britain, the Telegraph daily reported.
Until now, you were allowed to spend an average of 91 days each year in the UK before you became a resident. This average was calculated over a four year period. The day of arrival and the day of departure were until now not taken into account in this average, the Telegraph said.
As of April 2008, the day of arrival and the day of departure would be included in the calculation.
Martin Rimmer of The Fry Group, was quoted by the Telegraph as saying: "This will have a huge impact on those living abroad – and means that, from April 2008, expats making frequent trips back to the UK will have to carefully plan to ensure their non-resident status is not jeopardised. We are expecting more details to be published on this - the Government has said that the rules are being changed to bring Britain in line with international standards on residence - so it remains to be seen whether any changes to the 91-day average rule will apply."
Those who would lose their non-resident status, would be expected to pay UK tax on their earnings, which for many expats could prove costly.
The changes are part of new rules designed to make foreign nationals who live in the UK but are still classed as "non-domiciled" for tax purposes, pay "their fair share", the Telegraph said.
The measure especially targeted those non-domiciled who have been living and working in the UK for more than seven years, with a 30 000 pound (43 130 euro) a year levy to "ensure that they contribute in respect of the foreign income and gains which they keep abroad and on which they do not pay UK tax", Rimmer said.
"It looks likely that non-doms who have been in the UK for more than seven years will be faced with a choice – between an annual one-off tax payment or being taxed on their worldwide income and gains," the Telegraph quoted Rimmer as saying.
