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Tax advice for newly arrived resident
I think I need some tax advice. Does anyone know any way to get reliable and reasonably priced tax advice, please?
In summary I am a UK citizen who married a Belgian lady and moved to Belgium last June (2016). We are both retired and have pensions and some savings & investments - mine are mainly in the UK. I still have my apartment in London. My aim is to be able to complete the UK & Belgian tax returns without getting taxed twice & to keep tax to a minimum in future. Advice please?
Sounds like a straightforward matter.
Telephone advice from Inland Revenue and help from your commune with your Belgian tax return will cover it.
You can also go to your local tax office and they will complete the Belgian forms for you free of charge.
Unlike UK your tax details are handled locally.
As others have noted, your situation seems relatively simple so your local tax office is probably the best place to start, and it's free.
Before you go to your local tax office, contact the Revenue in the UK and explain your situation to them. They will send you forms which need to be completed before they will release you from their clutches and these forms need to be counter-signed by your local tax office here in Belgium before they are returned to UKR&C. You can then visit your tax office here to get the forms signed.
Your wife has doubtless explained to you that you get an annual joint tax form to be completed in late spring.
With income from, and investments and property in, the UK completing this form is anything but simple. You have to record all income, it will be taxed here in Belgium, but the amounts have to be entered in euros not pounds and, of course, the relationship between the two varies constantly. I keep an annual spreadsheet in which I record all income against the date on which it becomes available to me (ie appears in one or other bank account) and then, where necessary, convert it to euros at my bank's exchange rate as available to me on the date concerned (this bank exchange rate being the 0,9725 x the par rate euro/pound). Income received here in euros, e.g. my UK pensions, are simply recorded as that amount in euros on the date concerned. I send a signed copy of the spreadsheet to the Belgian fisc with my annual return.
Your local tax office is the ONLY place to go for advice here. Your situation is complicated but you are more likely to end up paying too little tax here than too much. If your tax office makes a mistake which subsequently gets spotted you will have to pay the extra tax due but no penalty, if you or another advisor had made the mistake, a penalty would have to be paid.
The double taxation treaties between the UK and the Belgians are available on line in English (on the UK R&C site) and in Dutch and French (on the Belgian site).
Incidentally, if you do wrongly get charged tax in both countries, the Belgian fisc will negotiate with the UK R&C on your behalf if they refuse to refund it. Contact the UK R&C now well before the UK tax year ends.
Unfortunately this is not straightforward. Whether Belgium or the UK has taxing rights over your UK pension income will depend upon WHEN the pension income came into payment (the double tax treaty on issues relating to pension income was amended a few years ago ) and also on the the type of pension. With regard to income from savings and investments, there could be some element of potential double taxation (eg in relation to dividends) and you should seek advice about the best way and jurisdictions in which to hold investments as a Belgian tax resident. Investments which may be tax-efficient for UK residents are not necessarily tax-efficient for those resident in Belgium. Your UK rental income should remain directly subject to income tax in the UK (only) but will be taken into account in determining the Belgian tax rates applicable to your Belgian taxable income. If you would like assistance, please let me know.
I am a bit puzzled by KATIEB's reference to the double tax treaty on issues relating to pension income being amended a few years ago. The current (1987) treaty came into effect at the beginning of the relevant tax years in 1990 ie roughly 27 years ago, hardly a few! There were some minor changes agreed in 2012 which came into effect during 2013 but these certainly don't change the basic principles of the taxation of pensions originating in the UK (including the UK state pension) but paid to a resident of Belgium - which are basically that it is taxed in Belgium and not in the UK unless it is a pension paid in respect of government/local government service in the UK in which case it is almost always taxed in the UK rather than in Belgium.
