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Offshore transfers

28 May 2013
Issue: 4404 / Categories: Forum & Feedback , Residence & domicile

A non-UK domiciled but resident client has used the remittance basis since 2008/09 and made an election under TCGA 1992, s 16ZA. Remittances have been made to the UK from a mixed offshore fund

My non-UK domiciled client has used the remittance basis since 2008/09 and made an election under TCGA 1992 s 16ZA. He remitted a significant amount of funds to the UK in 2011/12 from a “mixed fund” foreign bank account (one of several).

The deposits have been analysed between (broadly) income gains and clean capital for every year. However my queries concern the treatment of withdrawals that are not remittances to the UK or transfers to other foreign bank accounts.

First it would appear that income gains and capital of the fund should not be allocated to the alienation of funds used for personal foreign expenditure (eg payment of a foreign electricity bill). Is this correct? Such items would of course deplete the bank account without any unremitted funds being matched.

Second $20 000 was withdrawn in 2009/10 to acquire some foreign shares...

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