UK Fact-File Part 7:
Business Owner Welfare and Lifestyle

7.7 UK Individual or Business Leaving The UK

When considering moving from the UK to live and work in another country, the length of time a person is likely to remain abroad is an important factor. If the move abroad is likely to be longer term, then proper arrangements should be made to put financial affairs in order. Notifying the HMRC will ensure that tax and national insurance contributions are brought up-to-date.

The key issues to address before relocating are:

• Is the destination country a member of the European Union?
• What are the residency requirements if planning to live and work there long term?
• Is a work permit and/or a visa required?
• Is it necessary to open a bank account in the country and what are the costs and fees involved in transferring funds from the UK to the new country?
• Should any property owned in the UK be sold, or rented out?
• What is the tax regime of the new country – are the taxes there higher than in the UK?
• Is there an adequate education system?
• Is private medical insurance required and is their entitlement to free state healthcare?

It is important to ensure that all documents that might be needed are current and valid, including passport, birth certificate, driving licence (does it cover driving in the destination country?), visas and if applicable, the European Health Insurance Card.

Share Options Self-employed individuals may have acquired share options while in a previous period of employment. If these options are exercised and/or shares are sold either during or after a period spent working (employed or otherwise) in another country, a liability for tax may arise in more than one country. The double payment may be avoided partially or wholly through the terms of a Double Taxation Treaty. If no treaty is in force, HMRC is likely to give unilateral relief in respect of foreign tax covering periods of UK residence. Straight-line time apportionment is normally applied both within and outside the terms of a treaty. Evidently it is extremely important to take expert advice before exercising share options while abroad or before selling any shares so obtained.

The disposal of any assets (especially property) in the UK will be liable to UK capital gains tax if sold up to five years after the individual has left the UK. This does not apply to a property that is or was someone’s main residence. Income from letting a property in the UK whilst living abroad is also subject to UK tax.

A business operating in the UK through a branch or agency will be liable to tax on gains made on the disposal of assets, even though the owner is not resident in the UK.

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