Here are a number of areas that returning expats should research to ascertain whether or not they have an effect on their personal circumstances:
Becoming UK Resident
To avoid ambiguity and confusion, HMRC introduced a Statutory Residence Test in 2013. An expat will be able to determine whether or not they meet the definition of UK resident by following these tests.
Many expats still rely upon anecdotal knowledge and as a result become UK resident much earlier than they anticipated. The SRT is in three parts; the automatic overseas tests, the automatic UK tests and the sufficient ties test. The basic rule is that an individual is resident in the UK for a tax year and at all times in that tax year (although the effect of this rule is relaxed under split year treatment), if they do not meet any of the automatic overseas tests and they either:
HMRC recommends that these tests are worked through in a particular order, looking initially at the first of the automatic UK tests, then at all of the automatic overseas tests, followed by the remaining automatic UK tests and only then, if the residence position is still not clear, considering the sufficient ties tests. It is recommended to consider each category in turn as this is far simpler.
If you are a UK resident, you are subject to Income Tax on your worldwide income and Capital Gains Tax on your worldwide gains.
Expats who return to the UK mid-way through the year will have to pay tax on their income
for the entire tax year, unless they qualify for ‘split year treatment’. If split year tax treatment cannot be claimed then it is very important to look at when it is most tax efficient to return.
Changes in legislation since they left the UK
Over the last 10 years there have been a significant number of changes to UK legislation that the expat may not be aware of. One key area is that of Domicile in that irrespective of how long an expat has been non-resident, if they have a UK domicile of origin, they will reacquire their UK domicile whilst they are UK resident. If you are UK domiciled your worldwide estate is subject to UK Inheritance Tax.
Planning undertaken whilst non-UK resident
Many UK expats may have undertaken planning to return to the UK as a non-dom and take advantage of the tax benefits that this particular tax status affords however, for the reasons stated above this is no-longer possible. As such, any planning undertaken whilst non-resident should be reviewed to ascertain whether or not it still works.
Assets acquired whilst non-UK resident
You should determine the likely tax treatment of those assets and in particular the difference between disposing of them as a non-resident or resident of the UK.
What to do when you return
You may need to register for Self-Assessment (Linked to https://www.gov.uk/topic/personal-tax/self-assessment), for example if you are self- employed or still have other income or gains from the UK or overseas.
You generally don’t need to register if you’re an employee and don’t have any other untaxed income to report.
If you are returning to the UK within 5 years
You may have to pay tax on certain income or gains made while you were non-resident. This doesn’t include salary or other related employment income.
These Temporary Non-Residence rules apply if:
you return to the UK within 5 years of moving abroad (or 5 full tax years if you left the UK before 6 April 2013)
you were a UK resident in at least 4 of the 7 tax years before you moved abroad
Taking financial planning advice is imperative for British expats returning to the UK. And because finding a good financial adviser is like sorting the wheat from the chaff, here are a few tips: Finding a good financial adviser.
TECH BOOM
A global sell-off in tech stocks this week has raised questions about whether the current surge in demand for electronics products and components has peaked or whether investors are simply rotating to other sectors, such as banking.
For now, the economic data suggests Asia’s electronics producers remain in good shape.
South Korea’s factory activity expanded at the strongest pace in 55 months in November, with the Nikkei/Markit PMI rising to 51.2 from 50.2 in October. Japanese manufacturing grew at the fastest pace in more than 3-1/2 years. Taiwan’s PMI came at 56.3 in November, its best reading in 6-1/2 years.
“Even as the smartphone-related boost starts to fade, the outlook for 2018 remains bright amidst the global recovery,” HSBC Greater China economist Julia Wang said.
Japanese companies raised spending on factories and equipment in July-September by 4.2 percent from the same period last year, suggesting its September quarter GDP growth figures could be revised higher. Japan’s jobless rate held steady at 2.8 percent in October and the availability of jobs reached the highest in almost 44 years, although inflationary pressures in the world’s third largest economy remain stubbornly weak.
Likewise, in South Korea, export growth slowed but still recorded a 13th straight month of expansion in November, while inflation eased to the slowest in 11 months, reinforcing views that the new monetary tightening cycle will be gradual.
Reporting by Marius Zaharia; Editing by Sam Holmes
Global Markets News
Asian manufacturing buoyed by tech as focus shifts to regional rate hikes
HONG KONG (Reuters) - Asia’s major manufacturing economies saw their fastest expansion in factory activity in years last month, driven by robust demand for electronics and firming the case for central banks in the region to shift to tighter monetary policy next year.
A raft of mostly strong factory activity surveys released on Friday comes a day after the Bank of Korea became the first major central bank in Asia in three years to raise interest rates.
The tightening marks a potential turning point for the region with Malaysia and the Philippines among central banks that could lift rates next year.
The firm expansion in factory activity, seen in South Korea, Japan and Taiwan, has not been uniform, however, with Beijing’s war on pollution tempering growth in Chinese manufacturing in October.
Analysts expect any tightening by Asian central banks to be gradual and follow the lead in the United States, which is expected to hike again in December and three more times in 2018. U.S. and euro zone manufacturing surveys later on Friday are expected to show even higher growth rates than in Asia.
“We’re seeing the strong momentum in the third quarter carrying over in the fourth,” said Khoon Goh, head of Asia research at ANZ.
“The improving global backdrop ... suggests that central banks in this region will start policy normalisation. It’s important to note this is not the start of an outright tightening cycle, this is the removal of very accommodative policies.”
Elsewhere in Asia, India saw gross domestic product growth rebound in the three months to September, in a sign businesses are recovering from disruptions caused by the launch of a national sales tax and a shock ban on high-value banknotes.
Market penetration refers simply to growing with existing products in existing markets. This can be achieved by attracting new users in existing markets by two ways. One is by by attracting and gaining competitor’s customers. Another is by influencing current customers to use more of the organization’s products / services. Market penetration generally involves the least risk and the deployment of minimal resources.
2. Open Another Location / Geographical Expansion
Opening another location or geographical expansion refers to growing with existing products in new area or location. This step involves decision about the target niche, entry mode and control system. You should be accountable about the profits and surplus money that you are generating from current locations.
3. Launching New Products Or Services
This is one of the effective way to grow your small business. Develop a new product in the same target market. This strategy requires good innovation capabilities and market research. An organization can grow by simultaneous movement into new product and market domains. Launching new product is of course a very resource intensive strategy.
4. Offering Franchise Or Business Opportunity
Franchising is a very good option to grow your small business successfully. Understanding your business inside out is very much important before franchising a business. Form a startup franchisor point of view, first concentrate on developing a business model and the administrative and legalities that involve in franchise business.
5. Minimizing The Risk Factors
An important aspect in growing your business is the management of risk and uncertainties associated with the small business. These risks are associated with numerous details like production, development, distribution and marketing. However, not all risks require meticulous planning. There are many which can be easily addressed by simply paying attention.
6. Vertical Integration
It may sounds tricky but is an effective way to grow your small business. vertical integration defines the division of activities between an organization, its suppliers, distributors or channel partners and buyers. It can also be defined as a style of supply chain control. A higher degree of vertical integration would be when the organization takes up further value addition to its finished products to compete with its erstwhile buyers.
7. Diversification
Diversification to grow your small business is often considered as a major decision for any organization. This move can make or break the prospects of a business to prosper. Yes, it is a risky strategy. But it also dangerous for a business of staying in the same place too long. It has been found that many small businesses have got enough success by diversifying their business.
8. Merger & Acquisitions
Merger and acquisitions (M&As) are generally considered as an inorganic ways to grow your small business. These two are very effective growth channels. A merger is a phenomena where two organizations decide to come together to form a single new organization. In this case owners of both two organizations become owners of this new entity. Acquisition is a phenomena where one organization takes over the ownership of another completely.
9. Online Presence
Online presence is now most essential factor to grow your small business. Focus on that. Internet is the most effective tool to get the new customer. Not every business can benefit from investing in a website. However, there are virtually no businesses in the world that can afford to ignore to have a online presence. Whether you use it to research your competition or find opportunities to attract new customers, you need to start thinking about your digital presence and how it impacts your sales figures. Designing and programming is important, but the most important is quality content that will draw visitors to your site.
10. Social Media Optimization
Social media is generally considered as a technology makeover of word-of-mouth campaign in todays world. Social media is an effective way to grow your small business online. It is such a place where you can find a large number of potential customers. It is one of the most cost effective online advertising that has global reach. In addition to brand awareness, social media is a best way to draw new visitors to your website also.
Entrepreneurship is not an easy task. It is about building teams to exploit opportunities previously untouched. Small business owners need to manage, minimize and especially prioritize risks. Rather than being the attempt of a single person who starts a new venture, entrepreneurship is a team effort where many people come together to support an idea.
How China plans to beat the U.S. at technology
President Trump has made technology a key battleground in U.S. relations with China.
He launched an investigation into alleged Chinese theft of U.S. intellectual property earlier this year. But some experts say a bigger concern is Beijing's huge bets on the technologies of the future.
The Chinese government is throwing its weight behind sectors like artificial intelligence, electric cars and computer chips, pumping in money to create tech champions with global clout.
Western companies have already raised concerns about the plans, warning they may give Chinese companies an unfair edge at home and abroad. Some analysts have called for the U.S. to ramp up spending on technology research in order to keep pace.
Content by Dimension Data
Transforming fan experience at the Tour de France
You only need to look at the 2016 Rio Summer Olympics to see how digital technology is transforming the way we watch and consume sp
Russian President Vladimir Putin recently predicted that whoever becomes the leader in artificial intelligence "will become the ruler of the world."
China wants to be that leader. It laid out its plan this summer to become an artificial intelligence superpower by 2030.
The country's AI industry has "government support that most other countries don't really have," said John Choi, an analyst who covers Chinese internet companies for Daiwa Capital Markets. "The level of funding is not even comparable to most other nations."
The Chinese government's 2030 plan aims to build a domestic AI industry worth nearly $150 billion.
"China leads in the area for the simple reason -- it's a government push," said Chwee Kan Chua, global research lead for artificial intelligence with research firm IDC.
Electric cars
There's a reason why Tesla(TSLA) is eager to have a manufacturing plant in China. The country has the world's largest market for electric vehicles, thanks to years of generous tax credits and government subsidies.
China's efforts are yielding results for its homegrown industry. Domestic companies are among the leading makers of electric vehicles in the world, and Chinese consumers are increasingly interested in buying them.
Beijing is doubling down on the industry. The country's "Made in China 2025" plan calls for domestically produced hybrid vehicles and electric cars to account for at least 70% of total sales by 2025.
Major global automakers like Volkswagen(VLKAF) and Ford(F) have recently announced plans to develop electric cars in China with local partners, bringing their technological know-how into the country.
