Dubai influencers could face £5M in tax bills if they return to the UK from their luxury UAE havens after some bragged they'll be staying put despite no end to the Middle East conflict
You don't have to be a regular on social media to be aware of the sea of influencers bragging about their luxury lifestyles in Dubai, even as the US-Israeli war with Iran unfolds around them.While holiday-goers were desperate to board flights back to the UK, thousands have opted to stay put for reasons that were bewildering until now.However, it now seems that some are worried they could be greeted at passport control with a vast tax bill, as it's revealed thousands of expats would be liable for such charges if they were forced to move back to Blighty.Many influencers have stayed quiet on their true views of the conflict, after the UAE authorities sent out mass texts to Westerners with dire warnings that nobody was to post anything about the terror raining down on them.Celebrities were once eagerly attracted to the tax-free salaries they could earn in Dubai, and while many have secretly flown home, others are firmly staying put.Stars such as Rio and Kate Ferdinand, Luisa Zissman and Petra Ecclestone have chosen to leave their UAE lives behind, but others such as Arabella Chi, Kady McDermott and Hofit Golan are holding out... for now. Dubai influencers could face tax bills of up to £5million if they return to the UK due to the US-Israeli war with Iran, as stars including Arabella Chi (pictured) have stayed put... for nowExpats have called for clarity from HM Revenue & Customs over tax regulations they would face if they decided to leave Dubai and fly home.Accountants are now thought to be telling some clients that taking a holiday in another country until the new tax year starts on April 6, could help them avoid a 'massive' tax bill. Nikita Cooper, who is a tax director at accountants Price Bailey's Mayfair office, told The London Standard: 'Clients are facing unexpected capital gains tax liabilities of between £1million and £5million in relation to sales which were done within the last five years while being non tax resident.'Price Bailey are also warning clients they could fall victim to the UK's five-year temporary non residency rule, a measure designed to stop individuals leaving the UK briefly to dispose of assets tax-free in low tax jurisdictions, such as Dubai, before returning soon after.These rules state that if an individual becomes a UK resident again within five full tax years, capital gains realised while abroad are eligible for tax charges.Sandra Jeevan, partner and head of private client and trust at accountants UHY Hacker Young, told the publication that, for example, someone returning from the Gulf who became UK tax resident could face thousands in tax bills.She explained someone who became UK tax resident with £100,000 of employment income, £200,000 of investment income and £1million of capital gains, where their lifetime entitlement to Business Asset Disposal Relief has already been fully utilised, could see their 'tax exposure exceed £350,000'.Accountants are also warning some could face huge tax charges if they were to return to the UK for a period longer than the exceeded 'count' of 183 days spent in the UK during this financial year, which ends in April.As many influencers have already had to spend long periods in the UK, they are increasingly close to the 183-day limit, and could see their income eligible for the British tax net.Sandra Jeevan, who is a partner at the accountancy company UHY Hacker Young, told The Times: 'We are hearing from many families who never intended to return to the UK this year but now have had no choice. They could face exposure to UK tax simply because their emergency return alters their UK residence position.'When you are trying to move your family to safety, you are not focused on day‑count rules or technical residence tests. Stars such as Rio and Kate Ferdinand have decided to flee Dubai in the wake of the conflict, with the couple now holed up at their villa in Portugal Luisa Zissman has also returned to the UK despite declaring on social media she felt 'safe' in Dubai, with some influencers accused of pumping out 'propaganda' to support the state'While [HM Revenue & Customs] has updated its guidance to acknowledge that the outbreak of war can qualify as an "exceptional circumstance" for residency purposes, the rules remain highly restrictive and are strictly limited in scope.'HMRC maintains a very narrow view of what qualifies. Choosing to stay in the UK to be with family after the initial crisis has passed typically does not count as "exceptional".'HMRC's complex tax system can disregard up to 60 days spent in the UK by individuals due to 'exceptional circumstances'. A representative told The Times: 'The existing rules provide the right protection while following the basic principle that individuals living in the UK should pay tax in the UK. Exceptional circumstances, such as being affected by a war, are taken into account.'Some wealthy Brits fleeing the conflict in the Gulf are heading to Ireland and France to avoid huge tax bills, as many residents living overseas had already 'spent' the number of days on British soil they are allowed to without paying tax.Nimesh Shah, the chief executive of advisory firm Blick Rothenberg, said he had received 'a disproportionate number of calls' from those fleeing the UAE in recent weeks.Shah has urged them not to rely on the 'exceptional circumstances' provision, as he says HMRC view UAE expats as having moved in order to not pay tax in the UK, and are therefore unlikely to give the 'green light' for them to stay on British soil without paying.One wealthy business owner, who is staying in Dublin until the end of the financial year on April 5, told The Guardian: 'I’m happy to pay income tax and tax on investments next tax year, but I don’t want the sale of a business that I sold years ago to fall within UK capital gains tax.'I paid for my own travel home, by the way.'Meanwhile, another British entrepreneur, who was previously based in the UAE, said he would be residing in France for the time being.Another British UAE-based business owner said they would spend some time in France for now.The number of days a person who claims they are a non-resident for tax purposes can stay in the UK depends on several factors, including their links to the country, whether they have a spouse or children here and whether they have accommodation.Many who decided to emigrate over the last few years can stay in the UK for 45 days before they fall back under the country's domestic tax rules and regulations.It's thought that up to 300,000 British nationals live in the Middle East and many have relocated for tax reasons.Around 50,000 influencers were residing in Dubai, with many enticed to relocate due to the promise of a safe residence and low taxes through initiatives such as Creators HQ and the 1 Billion Followers Summit.Last year, the state even opened a so-called 'Influencer Academy' - a school for influencers - part of a broader strategy to recruit, train and incentivise content creators to promote the city globally.More than 63,000 Britons have returned home from the region since the start of the conflict in the Middle East, according to government figures.But influencers who have stayed put have faced claims they're being paid to pump out 'propaganda', after continuing to boast they're safe and well in Dubai despite the conflict raging on.Content creators with droves of followers have been sharing videos of Sheikh Mohammed bin Rashid Al Maktoum with the words 'I know who protects us', in the midst of Iranian attacks.Meanwhile, 45 people of 'various nationalities' have been arrested by police in Abu Dhabi for 'spreading misinformation and filming and sharing event locations' over alleged footage showing attacks.Rio and Kate were among the stars who have fled their homes in Dubai, but are now holed up at their luxury villa in the Algarve, raising questions of whether they are also keen to avoid a hefty tax bill.Former Apprentice star Luisa, who has been vocal in her support for the Dubai government, revealed she had returned to the UK for work with her children.When the crisis erupted in Dubai earlier this month, Luisa avidly informed followers she was in the 'safest country in the world' and 'everything was fine', before scarpering back to the UK to her £8million countryside mansion.Despite insisting her return was planned, Luisa stated she was 'in her refugee era' and revealed that her dog, Crumble, is currently stuck in Dubai – leading to her plea for a companion. However, she later added that the flight had been cancelled.Despite vocally advocating for how safe they felt in Dubai, Petra and her husband Sam Palmer also jetted out of the city earlier this month.However in contrast, notorious social media star HSTikkyTokky, has insisted all is well in Dubai, claiming that there were 'no bombs' flying over the city – hours after another drone attack suspended flights at Dubai airport. Arabella has been continuing with her day-to-day life in Dubai despite reports of 'rising panic' among other expats rushing to flee the Gulf state, and even travelled to Saudi Arabia to celebrate her birthday.Israeli socialite Hofit moved to Dubai in December and revealed she was left terrified and hiding in her bath when the war broke out.However, days later she insisted Dubai 'still feels like a very safe place', before sharing a glimpse of the 'quiet and calm' neighbourhood, as fellow expats returned to the beach.
