HMRC correspondence address whilst living abroad

Discussion in 'Accounts & Finance' started by commadus, Sep 12, 2020.

  1. commadus

    commadus UKBF Newcomer Free Member

    319 13
    My brother has been abroad working a few years - he has left his house on rent and used my address as his correspondence address.

    I received a Voter Registration form - only my wife and my name was on it - as we are the only adults that are of voting age that live here.

    I called the local voting office and explained that there were no changes but they said the new system works by doing a data check against HMRC records and that there are other people who are registered at my address who are UK citizens - they did not mention the names but I assume they are referring to my brother.

    I am now wondering have I or my brother broken the law?
     
    Posted: Sep 12, 2020 By: commadus Member since: Dec 9, 2007
    #1
  2. KAC

    KAC UKBF Ace Free Member

    1,290 298
    No law broken to the best of my knowledge.

    My daughter and her husband have lived in the Middle East for many years and still have everything registered to our address. I definitely do not include them on the Voter Registration Form as they are not resident on the relevant date.
     
    Posted: Sep 12, 2020 By: KAC Member since: May 7, 2017
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  3. Argentum Tax

    Argentum Tax UKBF Contributor Free Member

    96 19
    I would guess that if your brother has told, or implied to HMRC, that your address is his residential address with the hope of gaining a tax advantage (for instance with the 'Non Resident Landlord Scheme') then he may have some problem with the tax law. You may have a problem if you have conspired with him to gain the tax advantage.
     
    Posted: Sep 12, 2020 By: Argentum Tax Member since: Aug 24, 2015
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  4. KAC

    KAC UKBF Ace Free Member

    1,290 298
    .. and what tax advantage is that. Helpful to be more specific
     
    Posted: Sep 12, 2020 By: KAC Member since: May 7, 2017
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  5. Argentum Tax

    Argentum Tax UKBF Contributor Free Member

    96 19
    The tax advantage that sprung to my mind was the Non Resident Landlord Scheme; there may be others.

    By perhaps claiming or implying to be UK resident by supplying a UK address as his home address (rather than just as a 'correspondence address') the OP could be accused of giving HMRC the impression that he was not liable to be within the scheme, and hence not liable to deduction of tax by the letting agent or tenant, thus gaining a tax advantage. This would be especially so if the OP had asked the agent to record the UK address as his home address. In my experience letting agents will quickly tell HMRC the facts when asked.

    Apologies to the OP if I was not specific enough, but I had assumed the OP would have enough good sense to search on the term 'Non Resident Landlord Scheme' if he thought it would be relevant. Alternatively he could have posted again or private messaged me to ask further details.

    Nevertheless, here is the link:

    https://www.gov.uk/tax-uk-income-live-abroad/rent
     
    Posted: Sep 12, 2020 By: Argentum Tax Member since: Aug 24, 2015
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  6. KAC

    KAC UKBF Ace Free Member

    1,290 298
    OK thanks. That has hopefully made it easier for someone reading the forum to understand.

    They will also need to note that the non resident landlord can opt out of deduction of tax at source and opt to pay by self assessment. They will also be eligible for a personal allowance despite being non resident and unless they have other UK assessable income are unlikely to be liable to tax dependent upon rents received exceeding the PA
     
    Posted: Sep 12, 2020 By: KAC Member since: May 7, 2017
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  7. Argentum Tax

    Argentum Tax UKBF Contributor Free Member

    96 19
    Thanks KAC for expanding my answer. However, to quote what you say so clearly in your own footer: “By their nature my comments are general in nature and may not reflect the totality of the query.”

    In addition, I have confused the OP with his brother in my previous reply. My apologies to the OP again, though I am sure he knows what I meant.

    Incidentally, evasion of tax by pretending to be a UK resident, would not be the same thing as making application on form NRL1i which, if agreed, results in HMRC authorising the letting agent or tenant to pay the rents without deduction of tax.
     
    Last edited: Sep 12, 2020
    Posted: Sep 12, 2020 By: Argentum Tax Member since: Aug 24, 2015
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  8. commadus

    commadus UKBF Newcomer Free Member

    319 13
    I have spoken to my brother and he completed a form saying that he was not resident in the UK for taxes. He said he still completes an annual return but as the rent is less than the tax freee amount he doesnt pay tax on his UK rental income.
     
    Posted: Sep 13, 2020 By: commadus Member since: Dec 9, 2007
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  9. KAC

    KAC UKBF Ace Free Member

    1,290 298
    That's exactly the same as my daughter and her husband except I have to prepare their annual SA return o_O
     
    Posted: Sep 13, 2020 By: KAC Member since: May 7, 2017
    #9
  10. commadus

    commadus UKBF Newcomer Free Member

    319 13
    Because you're a good dad, and what else are dads for other than completeing SA returns? :p

    But still not sure why the Electoral Office was thinking that they need to register when they are not resident.

    Have you completed your Annual Voter registration canvass?
     
    Posted: Sep 14, 2020 By: commadus Member since: Dec 9, 2007
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  11. Argentum Tax

    Argentum Tax UKBF Contributor Free Member

    96 19
    I suspect this is because HMRC are under the impression that the OP's brother is resident there, rather than it just being a correspondence address. HMRC do routinely check their records against the Register of Electors. Any discrepancy and they will ask the Electoral Office to check. I would guess the Office will now report back to HMRC.

    This is why I sounded a note of caution earlier in the thread with regard to problems with HMRC.
     
    Posted: Sep 14, 2020 By: Argentum Tax Member since: Aug 24, 2015
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  12. Spur Support Services

    Spur Support Services UKBF Contributor Free Member

    68 13
    Assuming your brother has access to the HMRC Goverment Gateway service, can I suggest that he changes the first line of his address to C/O "Commadus". (please replace with real name)
    This just stresses that you are a postal address.
    If he is a UK Citizen then he continues to be entitled to his personal allowance, so there is no tax advantage.
     
    Posted: Sep 29, 2020 By: Spur Support Services Member since: Aug 21, 2020
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  13. Argentum Tax

    Argentum Tax UKBF Contributor Free Member

    96 19
    However it will make a difference as to whether the letting agent should deduct tax from the rents received when remitted to the landlord, under the Non-resident Landlord Scheme. That could give rise to a tax advantage in certain circumstances.
     
    Last edited: Sep 29, 2020
    Posted: Sep 29, 2020 By: Argentum Tax Member since: Aug 24, 2015
    #13
  14. Spur Support Services

    Spur Support Services UKBF Contributor Free Member

    68 13
    Not really, that would be a timing issue, not a tax advantage, and the individual could apply to receive income without deduction via the NRL1.
     
    Posted: Sep 29, 2020 By: Spur Support Services Member since: Aug 21, 2020
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  15. Argentum Tax

    Argentum Tax UKBF Contributor Free Member

    96 19
    I do understand that.
    However HMRC would see it as a tax advantage, not a timing issue, if the UK address was used with the intent of leading HMRC to wrongly conclude that the OP's brother was UK resident, and therefore the letting agent did not deduct tax from rent remittances.
    If ultimately there was no loss of tax then it would likely not be a matter for legal action, but it could lead to HMRC asking all sorts of questions. It could also depend upon what is shown in the letting agents records and HMRC do regularly visit lettings agents, I understand, and inspect what is said in their client files.
     
    Posted: Sep 29, 2020 By: Argentum Tax Member since: Aug 24, 2015
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  16. Argentum Tax

    Argentum Tax UKBF Contributor Free Member

    96 19
    As I said above, pretending to be UK resident is not the same thing as completing form NRL1 and getting HMRC authorisation.
     
    Posted: Sep 29, 2020 By: Argentum Tax Member since: Aug 24, 2015
    #16