News & Insights

RTC Deadline Looms

The deadline for compliance coincides with the date on which HMRC will, under the Common Reporting Standard, begin accessing information from 100 countries, on assets and accounts held in the name of UK resident taxpayers, which forms part of global initiative to reduce tax evasion.

RTC application and time limits – what you need to know

RTC applies to companies, individuals and trustees who have offshore assets or made cross-border money transfers and covers all of the following:

  • Capital gains tax, income tax and inheritance tax
  • Assets held in a jurisdiction outside of the UK
  • Income from a jurisdiction outside of the UK
  • Income derived from activities that mainly occur in a jurisdiction outside of the UK
  • UK income transferred abroad before 6 April 2017
  • In cases of inheritance tax, the transfer of an asset outside of the UK
  • Any activity or asset that occurs to the effect of the first four above-listed points

Time limits for assessment depend on the level of good faith HMRC believe has been demonstrated by the taxpayer:

For example, HMRC will only investigate errors made in good faith if they occurred as recently as tax year 2013/14 or later; errors made carelessly from tax year 2011/12 and later; and, in the case of “deliberate error”, from tax year 1997/98 and later.

It is important to remember that HMRC may not always agree with the you as to whether an error was innocent, careless or reckless and it may seek to investigate regardless. However, there is an important defence available: reasonable excuse.

Reasonable excuse

Taxpayers may avoid penalty if they can demonstrate they have “reasonable excuse”.

Examples of reasonable excuse may include incorrect, fraudulent, “bad faith” or negligent advice from a suitable and qualified financial adviser. For example, if you have been advised by a professional adviser to take part in a “legal” financial management scheme in the Cayman Islands that you later learn falls foul of RTC legislation.

Contact Blacktower today

Blacktower Financial Management can help you to optimise your finances, including expat regular savings and other investments, while also ensuring that they are compliant with RTC.

Contact us today for more information.

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However, although these changes have been empowering, they do place a greater emphasis on the need for trusted expat financial advice, particularly for those who wish to maintain the same standard of living they have enjoyed while working once they are retired and have to live entirely of the retirement income generated by their pensions and other assets.

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FCA Publishes Retirement Transfer Data

There are few, if any, financial decisions as important as deciding what to do with your pension. Nowadays there are so many choices, but the factors that influence the path you choose are complex and should only ever be undertaken in full knowledge of the various options available as well as their many implications.

For example, significant numbers of UK citizens abroad are likely to benefit from an expat retirement transfer, but converting a defined benefit (DB) scheme into a QROPS or SIPP should never be undertaken without reliable and impartial advice that takes full account of the retirement saver’s circumstances.

Unfortunately, it can be difficult to find an expat financial adviser who understands all the regulatory and cross-border wealth planning issues at stake.

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