Overview

This bill aims to clarify the taxation status of members of the House of Lords, deeming them UK residents for tax purposes. Members can opt out by taking life leave from the House, effectively forfeiting their seat.

Description

The House of Lords (Members’ Taxation Status) Bill mandates that all members of the House of Lords are considered resident, ordinarily resident, and domiciled in the UK for tax purposes. This means they are liable to pay UK taxes on their worldwide income.

However, the bill provides an exception. Members can declare to the HMRC and the Lord Speaker that they do not wish to be treated as UK residents for tax purposes. This declaration must be submitted within three months of the Act coming into force. Upon making this declaration, the member will be automatically and irrevocably granted lifetime leave of absence from the House of Lords.

Furthermore, the bill ensures that future members of the House of Lords must also meet the UK residency criteria for taxation purposes before taking their seat.

Key Provisions:

• All existing and future members are deemed UK tax residents unless they opt out.
• Opting out requires a written declaration to HMRC and the Lord Speaker, resulting in permanent leave of absence from the House of Lords.
• The Lord Speaker is responsible for notifying HMRC of members' declarations and statuses.
• The bill amends the Income and Corporation Taxes Act 1988 to explicitly state this new legislation as an exception to any double taxation relief.

Government Spending

The bill is not expected to significantly impact government spending. While it could potentially increase tax revenue from members of the House of Lords who would otherwise avoid UK taxes, this increase is likely to be negligible in the overall government budget. No specific figures are provided in the bill itself.

Groups Affected

• Members of the House of Lords: This bill directly affects all members. Those who are not UK tax residents will be forced to either become UK residents or resign.
• HMRC (Her Majesty's Revenue and Customs): HMRC will be responsible for processing declarations and ensuring compliance with the new legislation.
• The Lord Speaker: The Lord Speaker will have administrative responsibilities related to the implementation of this bill.

Powered by nyModel