The Government confirmed on 13 July that a second 2017 Finance Bill will be introduced as soon as possible after Parliament’s summer recess ends on 5 September 2017. Read more.
The Bill will include updated draft clauses relating to the new deemed domicile regime and IHT on UK residential property and related finance arrangements originally removed from the first 2017 Finance Bill due to the UK’s general election.
The Government has also confirmed that those policies announced as applying from the start of the 2017/18 tax year or other point before the introduction of the forthcoming Finance Bill, will continue to do so.
On that basis, those non-domiciled individuals who were to have become deemed domiciled in the UK for income tax and capital gains tax from 6 April 2017, under either the 15/20 year residence rule or as UK returners, will be deemed domiciled from 6 April 2017.
Protections for offshore trusts, rebasing of non-UK assets, and ‘cleansing’ of mixed funds will also apply from the same date and interest held in a UK residential property via an offshore company or overseas partnership, or collateral used for loans taken out to purchase UK residential property, will have been subject to IHT with effect from 6 April 2017.
The updated clauses provide some clarity in some areas but uncertainties remain and it appears that affected taxpayers will have to continue to wait for publication of the Bill in the autumn as well as promised HMRC guidance for further clarification.
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