UK Budget 2021: How does the UK Budget affect non-UK residents?

You can sit and watch the UK Budget 2021 live or you can wait for a summary in the next day’s media. Whatever way you decide to do to stay current with the latest UK tax news it can still seem quite complicated, and you may be left wondering how it all affects you as a non-UK resident. The easiest solution is to ask a good non-UK resident tax advisor, like The Taxman UK, to do all the work for you. Our team of experienced non-UK tax advisors at The Taxman UK will calculate your tax liabilities after any new tax changes, fill in your non-UK resident tax return and file it for you with HMRC.

UK Budget 2021

Some things stay the same and some things change. The good news for non-UK residents is that tax thresholds are frozen, but this means that income and other tax rises are coming. If you are a non-UK resident paying tax on your earnings, capital gains, inheritance, or investment income in the UK then there are tax changes ahead for you and your loved ones.

Here is a summary of some of the main points of the UK Budget 2021 that may affect you as a non-UK resident taxpayer.

UK Budget 2021

The Basics

  • The income tax Personal Allowance and higher rate threshold will be maintained from April 2022 until April 2026.
  • The 2021/22 increase of the Personal Allowance to £12,570 and basic rate limit to £37,700 will be set to remain for 2022/23, 2023/24, 2024/5 and 2025/26. The higher rate threshold will be £50,270 for these years.
Inheritance Tax

Inheritance Tax

  • Inheritance tax thresholds will be maintained at their current levels until April 2026.
  • The nil-rate band will continue at £325,000, the residence nil-rate band will continue at £175,000, and the residence nil-rate band taper will continue to start at £2 million.
UK Pensions

UK Pensions

  • The Lifetime Allowance will be maintained at its current level of £1,073,100 until April 2026.
  • The adult ISA annual subscription limit for 2021-22 will remain unchanged at £20,000.
UK Benefits

UK Benefits

  • There will be a six-month extension of the £20 per week Universal Credit uplift in Great Britain, with the Northern Ireland Executive receiving additional funding to match the increase.
  • A one-off payment of £500 will be made to eligible Working Tax Credit claimants across the UK.

UK Housing

  • The stamp duty holiday on properties worth up to £500,000 will be extended from the end of March until the end of June and then there will still be no duty on homes worth up to £250,000 for another three months. After that, the threshold returns to the usual level of £125,000 from October
  • A new mortgage guarantee scheme will enable all UK homebuyers to secure a mortgage of up to £600,000 with a 5% deposit.

There is more than this in the UK Budget 2021. Whether the UK Budget 2021 changes your tax liabilities as a non-UK resident or not, for these or other areas, is for you to determine as a non-UK resident taxpayer. Don’t miss out on any opportunities to pay less tax. Take some good, professional tax advice from our non-UK resident tax advisors at The Taxman UK. We are able to advise you on current changes in UK tax rules for any tax issues you and your loved ones may face. We can also assist you with tax planning for what future UK Budgets may hold for you. 

Please don’t hesitate to contact one of our experienced non-UK resident tax advisors by sending us an enquiry at help@thetaxmanuk.com for an initial consultation. Good tax advice will save you time, money and stress, whether you watch the UK Budget 2021 live or not.

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