# Uk isa



## jb1974123 (Aug 1, 2014)

Hi,
I have set up an ISA account with Barclays using my parents' UK address....

I have used my UK NI number, but clearly do not comply with the requirement for 
UK residence, having worked in Spain for 14 years. Is there a real risk I might get caught? If so, what could happen, prosecution, fines???

Thanks in advance!


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## castaway06 (Jul 25, 2014)

The reality is you wont get caught, I wonder how many people on here have done something similar 

As long as the ISA is up and running you have nothing to worry about, the only point of minor risk will occur when you go to cash it in. At that point one of two things will happen:
1: nothing
2: For some reason the authorities will realise the address is essentially fake. Then all that will in all likelyhood happen is they will charge you the appropriate amount capital gains tax on the ISA(s)

Something to consider, what will happen to the address when your parents are no longer around? Where will you move your "residence" to? 

Don't do anything stupid, like have correspondence sent out of the country, or attempt to cash it in by paying in to non-uk account and you should be fine.


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## snikpoh (Nov 19, 2007)

castaway06 said:


> The reality is you wont get caught, I wonder how many people on here have done something similar
> 
> As long as the ISA is up and running you have nothing to worry about, the only point of minor risk will occur when you go to cash it in. At that point one of two things will happen:
> 1: nothing
> ...



Surely once you have an ISA set up, there is nothing to strop you moving abroad. Obviously you are not allowed to add to this fund but I think that's the only restriction.

So, if you need to change address, why not give them your real one in Spain.


... or am I wrong?


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## Alcalaina (Aug 6, 2010)

As I understand it, once you are tax-resident in another country (e.g. if you live in spain for more than half the year), the interest on the ISA is no longer tax-free and you have to declare it as part of your worldwide income.


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## mrypg9 (Apr 26, 2008)

Alcalaina said:


> As I understand it, once you are tax-resident in another country (e.g. if you live in spain for more than half the year), the interest on the ISA is no longer tax-free and you have to declare it as part of your worldwide income.


I think you are right, in fact I'm sure of it.

But then we view these things differently from claiming unentitled Welfare benefits.


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## extranjero (Nov 16, 2012)

snikpoh said:


> Surely once you have an ISA set up, there is nothing to strop you moving abroad. Obviously you are not allowed to add to this fund but I think that's the only restriction.
> 
> So, if you need to change address, why not give them your real one in Spain.
> 
> ...


Correct me if I'm wrong, but surely the OP intends to use the ISA as if he is in the UK, ie: adding to his fund and getting tax free interest. Why else would he be setting up an ISA in this way ?
What happens when he does his income tax declaration in Spain?
I think he is setting up up a tangled web.
He is also breaking the rules misleading the bank as to his address, and if he uses the ISA as if he lives in the UK he would be breaching the rules.
Presumably the OP has been. declaring his worldwide income, savings interest etc. for the last 14 years? Why start trying to hide things now just for a bit of tax free interest?
Castaway06 , I'm sure many do this, and a lot more, but it's hardly to be encouraged!


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## castaway06 (Jul 25, 2014)

I did not condone or encourage the practice, merely comment as requested on what I thought would or would not happen.

However having said that if the Spanish financial services industry was a little less backward (its so primitive a piggy-bank looks sophisticated) then maybe we'd use products here instead.

BTW as long as your non-Spanish, non-pension, assets fall under the form 720 limits you don't have to declare them. As for the income I'm not sure but I guess as long as the income stays inside the ISA wrapper then its not real income, (its like re-invested dividends) it only becomes income when you take it out (and can spend it)


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## extranjero (Nov 16, 2012)

castaway06 said:


> I did not condone or encourage the practice, merely comment as requested on what I thought would or would not happen.
> 
> However having said that if the Spanish financial services industry was a little less backward (its so primitive a piggy-bank looks sophisticated) then maybe we'd use products here instead.
> 
> BTW as long as your non-Spanish, non-pension, assets fall under the form 720 limits you don't have to declare them. As for the income I'm not sure but I guess as long as the income stays inside the ISA wrapper then its not real income, (its like re-invested dividends) it only becomes income when you take it out (and can spend it)


It's like any other savings interest , it has to be declared.


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## ddrysdale99 (Apr 3, 2014)

If he's not a UK tax payer then why use an ISA?
If he's a Spanish tax payer then he must declare his UK interest as taxable income. Surely it doesn't matter if that interest is tax free for a UK tax payer?


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## extranjero (Nov 16, 2012)

ddrysdale99 said:


> If he's not a UK tax payer then why use an ISA?
> If he's a Spanish tax payer then he must declare his UK interest as taxable income. Surely it doesn't matter if that interest is tax free for a UK tax payer?


1 exactly
2 correct


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## jb1974123 (Aug 1, 2014)

Thanks a lot! Just the answer I was looking for.....


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## brocher (Mar 21, 2011)

jb1974123 said:


> Hi,
> I have set up an ISA account with Barclays using my parents' UK address....
> 
> I have used my UK NI number, but clearly do not comply with the requirement for
> ...


it's quite simple, you aren't allowed to open an ISA nor contribute to one if you are not UK tax resident- HM Revenue & Customs: Frequently Asked Questions

Pointless exercise as the interest rates are so you'll have to keep moving the money around- this compounding your fraudulent actions. You'll also have to declare the interst in Spain and pay tax on it.


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