Form P85 is the document you need to complete in order to claim UK tax relief if you are leaving Britain to live abroad. You used to be able to submit P85 claims before you left the country. But in 2017, the rules changed and now you must wait until you have actually emigrated before you even send a completed application.
What information do I need for my P85?
Amongst other things, on a P85, you need to enter; all the usual personal details, employment details from when you were living in the UK and your position abroad, and information about any continuing UK income.
You need to have all your facts and figures to hand because you cannot save and go back to the online form. So, unfortunately, you can’t input all your information and shred the documents before you go, you need to keep it all and take it with you.
You also need to send Parts 2 and 3 of your P45 with your P85, so keep that in the ‘important paperwork’ bag before you travel. If you’ve already moved and misplaced your P45, your old employer can issue a ‘statement of earnings’ on headed paper as an acceptable replacement. (They cannot send you a duplicate P45.)
Why have HMRC changed the rules?
HMRC have changed the rules because people change their minds. Not everyone who says they are leaving Britain actually goes. Many organised people have submitted their UK tax rebate claims well in advance of their departure date and, if they end up staying, there is a mass of paperwork to unravel.
This change to the P85 rule is designed to avoid that. It should also streamline the application process because the information from employers that is necessary to action a claim, will have already been received by HMRC before you complete form P85.
So, when do I have to use a P85?
Now, you have to send HMRC your P85 once you have left the UK and are now living elsewhere.
This form is for people who are emigrating permanently or are not sure when they are returning to the UK. It is also for those who are definitely working in another country for at least one complete UK tax year. You do not have to use form P85 if you complete a self assessment tax return for reasons like being a UK non resident.
What am I claiming tax relief for?
Most people that leave Britain during a tax year discover that they are owed a tax rebate from the British Tax Office. This is due to a number of things, like not using your full Personal Allowance amount and work related expenses. Each claim is unique to that taxpayer’s individual circumstances. It is vital to complete your P85 accurately, both to maintain positive relations with HMRC and to make sure that you are claiming your full UK tax relief entitlement. Even without any tax relief to claim, your P85 ensures that your tax record in the UK is kept current.
Given the number of possible variables within the taxation rules, it is wise to get in touch with a tax specialist who can guide you through the P85 process. We can help you with several aspects of becoming a UK expat and it doesn’t matter what time zone you are living in.
