Niall’s virtual diary archives – Sunday 1st May 2016

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Sunday 1st May 2016: 9.56pm. Spent much of today filling in UK tax returns (plural). But I live in Ireland which is a sovereign nation, so one might reasonably ask why I am submitting UK tax returns? Good question. I did run a business in the UK from Ireland 2010-2014 as I was given no choice by the British government if I wanted to collect the Single Farm Payment for land I own in the UK. That farming entitlement was eliminated in 2014, so I closed down the UK business, yet the British taxman remains on the hunt for me, and has fined me two consecutive years in a row now for not filing a UK tax return. So, rather than get fined £10 per day which is what comes next, I submitted my UK tax returns for 2015 and 2016 and I suspect I'm going to have to suck it down and pay them their fines too until I can figure out some way of getting them off my back.

The non-residents form is quite a bit longer and more complex than the tax-resident form. The UK income tax forms are considerably more complex than the Irish one (Ireland has a lovely, if punitive to unearned income, simple and logical tax system). Thankfully the UK's tax forms are not even on the same realm as the Canadian or US tax forms, North Americans suffer a truly byzantine tax system. And as with all European countries, here the government does your tax return for you unless you have self employed income, unlike in North America.

At least I don't have to pay tax twice on the UK income - I learned today that EU residents get the same tax credits as a native born, and you can earn £16k in Britain per year without paying a penny in income tax, so no tax arises in Britain for me, just in Ireland as part of taxing my worldwide income, and UK National Insurance @ 13.8% doesn't arise as I don't live there.

Still, I am strongly looking forward to dispensing with the hassle of filing tax returns in a country I don't live, not least that the UK and Irish tax years are not the same, so you have to duplicate the work of calculations due to the differing dates. The great trouble with tax systems is they are quite hard to ever detach from, the Canadians slapped me with a $1200 fee in my last tax filing with them which was in 2015 and I half expect more fines to turn up this year. One is half tempted to tell them and the British to go stuff themselves, but the trouble with tax collectors is they are apt to keep turning the screws on you for the rest of your life.

I pity the poor Americans whose tax authorities pursue them no matter where they live. Sell a house with a significant capital gains and the Federal government nabs 20% of it on top of whatever tax you pay in the country you live. I can see why so many Americans renounce citizenship, it can't be fun dealing with multiple tax authorities for the rest of your life forever :(

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