With proposed new measures relating to non-UK domiciled individuals (non-doms) due for release by HMRC on 14 June 2011, accountancy firm KPMG is urging non-doms to give thought to their UK investment strategies sooner rather than later.
One of the measures is a new relief for nondoms who remit foreign income or gains to the UK for the purpose of commercial investment in UK businesses.
“It can take time to change investment strategies, non-doms who wish to take advantage of this change may want to start thinking about this now so they are in a position to act quickly when the final changes are announced,” explains KPMG in its latest private client newsletter.
Currently non-doms are likely to incur a tax charge on the remittance of foreign income or gains to the UK and consequently many have structured their investment strategy to exclude UK investments. KPMG says the new relief is an encouraging step, but much will depend on the detail. “What will be crucial will be what falls within the definition “commercial investment in UK businesses”. Once this is known non-doms can start to reassess their investment strategies,” says KPMG.
There is a possibility the Government may seek to restrict the new relief to investment in trading rather than investment companies and perhaps to smaller companies with which the non-dom is unconnected, rather than for family companies. Although early consultations with HMRC indicate that the new regime may be more liberal and may permit a remittance into investment companies, according to KPMG.
After the consultation, legislation implementing these changes will be included in Finance Act 2012 to take effect from 6 April 2012.
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