188. Paying taxes on Indian

income in UK - Dual taxation

Q: Dear Mr. Chand, I have some rental income generated from the flat bought by some amount of money from the sale proceedings of a property which was gifted to me. On the remaining amount I paid the capital gains tax and the amount left I made FD/ invested in mutual fund. All these things were done before I became British citizen. So I have some income through that as well. I file the income tax in India for the same. I don't repatriate this income to UK where I live. It remains in Indian banks or reinvested there. I also have regular income in UK and am the British citizen and give the appropriate taxes here for the income generated here. Do I still need to declare in UK my income which is generated in India even though I am not repatriating it here? Thank you for providing this wonderful service. It is really very helpful. A. UK is one of the many countries that expect their citizens to pay tax on their world wide income. Overseas income is declared on the foreign pages of your tax return. Declaring your income from India does not necessarily mean that you will owe UK tax on your income from India; because if you've paid foreign tax on the income in India (as mentioned in your email) you may be able to deduct this as a credit as UK and India have a dual taxation treaty. For some types of foreign income such as rental income, depending your your residency status for tax purposes, those who classify themselves as resident, but either not ordinarily resident or not domiciled in the UK, may be required to pay tax on only if the income is brought back into UK. A tax accountant should be able to guide in this regard.