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ProACT’s Sam Orgill looks forward to the highs of 2025 for UK expats living and working abroad.

UK TAX FLURRY

As the UK tax system gears up for another busy period, taxpayers are reminded of their obligations for the 2023-2024 tax year. All Self Assessment tax returns must be filed online by 31 January 2025, with any tax owed paid by the same date. Missing these deadlines triggers penalties, starting with a £100 fine and escalating with time.

This serves as a critical reminder for UK taxpayers, including those living abroad, to stay compliant. Whether dealing with fixed taxes or responding to an official request for a return, professional guidance is invaluable. ProACT’s Know How offers tailored assistance to navigate these requirements.

NEW YEAR TAX IN CYPRUS

For UK expats in Cyprus, understanding local tax obligations is equally important. Tax deadlines vary depending on the type of tax:

• VAT and Social Insurance: Quarterly returns are due, with payments by the end of the following month.

• Income Tax for Individuals: Returns must typically be filed by 30 June of the following year.

• Corporate Tax: Companies have until 31 December to file their returns, with tax payments split into two instalments: 31 July and 31 December.

ProACT’s Know How offers bespoke advice to ensure compliance with Cyprus tax regulations, helping individuals and businesses stay on top of their financial responsibilities.

SPRING ROLL OVER

In a seismic shift to the UK tax landscape, the government plans to abolish the 'non-domiciled' (non-dom) tax status from April 2025. This reform, ending a 200-year-old exemption, means all UK residents will be taxed on their worldwide income and capital gains. The change is projected to boost tax revenues by £2.6 billion annually but may drive wealthy individuals to seek tax-friendly destinations such as Cyprus.

Beyond income tax, the reform’s ripple effects will increase estate liabilities. With higher net estate values, UK residents face 40% inheritance tax on worldwide assets. The government’s intention to remove inheritance tax exemptions for non-doms adds another layer of complexity, potentially upending long-standing estate planning strategies.

ProACT’s Know How provides critical insights and strategies to protect family and business wealth from rising capital and inheritance tax liabilities.

TAX AUDITION

In Cyprus, businesses with an annual turnover exceeding €70,000 must prepare and approve their financial statements within 12 months of the financial year’s end (December 2024). These statements must undergo an independent audit, with the report submitted to the Department of Registrar of Companies and Official Receiver within 28 days of approval. Failure to comply may result in penalties and legal action.

ProACT’s Know How ensures businesses remain compliant, offering expert guidance on financial reporting and audit requirements.

DEEMED DOMED

For UK expatriates, inheritance tax obligations hinge on domicile status. Being deemed domiciled in the UK subjects individuals to 40% inheritance tax on worldwide assets. Non-domiciled individuals are only taxed on UK-based assets, but upcoming reforms are set to alter this dynamic.

From April 2025, the abolition of the non-dom tax status will mean individuals who have been UK residents for 15 of the last 20 years must pay tax on worldwide income. This could extend inheritance tax liabilities up to 20 years after leaving the UK. ProACT’s Know How helps expats navigate these changes, providing clarity and strategies to minimize tax exposure.

SHELTERED STRATEGIES

The October 2024 Halloween budget marked a turning point with the abolition of non-dom tax status. Alongside taxing worldwide income, the reform eliminated the ability to shield offshore assets from UK inheritance tax. For many, this reform has made relocating to countries with favorable tax regimes, such as Cyprus, an appealing option.

ProACT’s Know How supports expats in relocating, investing offshore, and protecting family and business wealth while living and working abroad.

A NEW TAX OUTLOOK

With the abolition of the non-dom tax status and other sweeping reforms, 2025 will be a pivotal year for UK taxpayers at home and abroad. Individuals who have been UK residents for 15 of the past 20 years must brace for taxation on global income, including foreign earnings. These changes make proactive planning essential.

ProACT’s Know How equips UK taxpayers with the tools to adapt, offering expert guidance to safeguard income and capital for a prosperous new year.