The proposal should significantly enhance the attractiveness of the UK as a location for non-doms wishing to commence or continue businesses, says Sophie Dworetsky, parter at Withers.
Reaction from Sophie Dworetsky, partner in the Wealth Planning team at Withers:
On expanding the remittance basis:
‘The coalition today made a further stride in creating stability, predictability and fairness in the UK tax system. Draft legislation which significantly expands and simplifies the remittance basis should make the UK more of an onshore haven for non domiciles. The proposal is that from 6 April 2012 offshore monies can be brought into the UK tax free where they are to be invested in a wide range of unlisted commercial and trading businesses. This offers real scope for further investment into the UK, and should also significantly enhance the attractiveness of the UK as a location for non-doms wishing to commence or continue businesses.’
On capital gains tax relief on art works:
‘In a welcome boost for the London art market, it is proposed that gains on a wide range of assets purchased offshore and sold onshore by non domiciliaries will be exempt from any charge to capital tax gains. No doubt this will add to the bustling trade done in the London auction houses.’
On delays to the statutory residence test:
‘It is a shame that the statutory residence test will not be in effect until April 2013, and that draft legislation is not yet available. That said, the promise of such a test is helpful, as is the commitment that it will be in similar form to the proposals made in the consultation document in July 2011. While not the same thing, the promise of certainty is at least inching towards actual certainty, albeit more slowly than ideal. For the moment, advisers and their clients will have to try to discern the current law for a little longer.’