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UK tax year-end planning: offshore income gains

For those taxpayers who are paying, or who will be paying UK tax on their worldwide income and gains...

Last updated: 13 February 2019

... you should be aware that when you invest in non-UK collective investment funds that do not have HMRC reporting status (e.g. US mutual funds) any gains made on the sale of such investments are charged to UK income tax (up to 45%, or 46% in Scotland) and not UK Capital Gains Tax. Any loss can be taken as a capital loss but cannot offset against income or Offshore Income Gains.

Similarly, US taxpayers should be aware that non-US collective investments can be caught by punitive PFIC rules. 

What should I do?

Americans living in the UK should be aware that investments held in the US such as US mutual funds that don’t have UK reporting status will be taxed at higher rates than the normal 20% capital gains tax rate. Speak to your financial advisor about other options for US/UK tax efficient investment. 

Follow the relevant links below to read more:

We recommend that individuals seek professional advice where appropriate before taking any action, so please fill out the form below if you have any questions. 

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