Going Home? Don't Leave Your Tax Behind!
Suitcase packed? Ticket bought? Said goodbye to friends? There is a lot to organise if you decide to leave the UK to go back to your home country. And here is something else you should put on your to-do list: claim back tax.
Most of us, if we were working temporarily in the UK and leave before the end of the tax year (5 April) are entitled to claim back some overpaid tax. Here is why:
Your personal allowance
If you are resident in the UK (that is, if you meet the statutory residence tests), then you will most likely be entitled to a personal allowance. This is the amount of money you can earn tax free each year. You will be classed as UK resident if you meet the statutory residence test.
The personal allowance is £10,000 in the 2014/15 tax year and every month or every week you are entitled to 1/12 or 1/52 of it on a cumulative basis (depending on whether you are paid monthly or weekly). Say you leave the UK on 1 October 2014, i.e. halfway through the tax year, you are likely to have received only half of the personal allowance that you are entitled to for the year konsultan pajak jakarta. So, if your income was below your annual personal allowance and you had any tax deducted from your pay, you should be entitled to a tax refund.
But what if you left the UK some years ago? Here is the good news: You can claim back tax for up to the past four tax years. However, you should be aware of the various personal allowances that applied in the respective years:
If you have other income
If you had other income, such as savings, investment, property or self employment income, the situation gets a bit more complicated and your full income needs to be taken into account when calculating your tax liability at the time you leave the UK.
If you expect to continue to receive UK income after you leave the UK, HMRC will not issue a tax refund before the end of the tax year (5 April). Instead, your total tax liability will be assessed at the end of the tax year and any refund that may be due to you will be issued to you then.
What if you return to the UK?
If you return to the UK after the following 5 April (i.e. after the end of the tax year), there won't be any problems. If you intend to return before 5 April to work, you should not apply for a tax refund at the time you leave the UK. If you do so, HMRC may ask you to repay the refund you may have received. Instead, you should apply for a refund after the end of the tax year.
So, if you are leaving the UK, don't forget to your tax amongst all the packing and planning.