The UK government has confirmed the continued availability of UK personal allowances for expats until April 2017 at least.
Five million Brits who live abroad were fearful after the government proposed the grossly unfair policy of demanding that non-residents pay income tax from the first pound in a budget statement last year. The British government now states,
Last year the government launched a consultation on whether or not to restrict the income tax personal allowance for non-residents. Whilst the government believes there is a strong rationale for doing this, it recognizes it is a complex change for both
employers and individuals who may be affected. The government will continue to discuss implementation of this change with stakeholders. Should the government decide to proceed, a more detailed consultation will be undertaken. No change will come into
effect before April 2017.
Tax specialists say that the government has backed down, at least for now, because there are too many categories of expats to fit a one-size-fits-all solution. John Dolan said:
There is all the difference in the world between retirees living here on small pensions and wealthy individuals with jobs in Thailand and property in UK which they rent out. If the scheme had been introduced, the pensioners would have been worst hit.