Non resident UK - Tax return

I am also based outside the UK in the EU.
None of the UK platforms I use are withholding any tax.
Taxation happens at the place of my residence.
This is not tax advice - seek professional advice for your situation.

From what I have read it is possible that the UK government will in future require P2P platforms to deduct tax, however that is not the case now.   If they do so I would expect that you could submit a form R105 mentioned in your link which is currently used to prevent banks and building societies from deducting tax from your interest payments.

This is not a professional opinion either.











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Peer to peer platforms do not deduct have to income tax. In the UK from 6 April 2016 no normal savings accounts deduct income tax. Not deducting tax at source does not mean that there is no income tax liability. It just means that the tax payer has to tell HMRC and ask HMRC to tell them the tax bill. HMRC will have online tax accounts in the future that will show the interest information sent to them by interest payers and they will use that to produce tax bills for UK residents.

HMRC guidance for you is at Tax on your UK income if you live abroad. You do not have a personal allowance that is tax free, the £10,000 that homes119 mentioned, unless you are a citizen of an EU country, you worked for the UK government in the tax year or it is included in a double-taxation agreement. There is a £1000 a year Personal Savings Allowance which makes that much interest tax free but you will need to check whether that includes you. My guess is that it does not unless you are a citizen of an EU country.

There is a summary of double taxation agreements from HMRC but as you say, Brazil is not on that list. This means that you may be liable to pay income tax to HMRC and Brazil on the same money. But Brazil might let you deduct the UK tax that you have paid, you need to check what the law of Brazil says.

From 2018 at the latest UK and Brazil will start to share income information so no later than that the authorities in Brazil will be told about your UK interest income. Brazil is not one of the 54 countries that start by the end of 2017.

I've decided to do nothing as the interest income I receive is way below the personal allowance. 

I'm still not sure if I have to do a self assessment, pay the tax and then claim it back via the R43 form or just send the R43 HMRC form to discharge myself of tax or do nothing as I am below the allowance threshold and no tax has been withheld.

Thanks James! 

0risk I don't understand either!

My post which you cite was written when UK tax law required tax to be deducted at source on most UK interest.  It was administratively convenient then to restrict the liability of non-residents to the tax actually deducted.

With the recent change in the tax law so that interest is no longer deducted at source, it would have made sense to remove this restriction, with the result that non-residents would have to declare all their UK interest income to HMRC.  However, the latest version of HS300 (https://www.gov.uk/government/publications/non-residents-and-investment-income-hs300-self-assessment-helpsheet/hs300-non-residents-and-investment-income-2016) suggests that the restriction still applies.  I find this surprising.

Edit:  The above is incorrect.  See my post of 3/10/2016.

Puruing tax from non-residents is pretty fruitless, so thios rule basically states the practical result in any case, otherwise only the honest would end up paying!

The obvious answer would have been to retain interest deduction at source for non-residents. However this would be illegal for EU nationals and so could only have applied to a minority.

- PM