****NEWSFLASH - RESIDENCY - Landmark ruling of Court of Appeal****
The Court of Appeal have now ruled that Robert Gaines-Cooper was liable to pay UK tax despite spending less than 91 days a year in the country because England had remained "the centre of gravity of his life and interests".
This is a serious blow for many based overseas who visit Britain frequently.
The three Court of Appeal judges expressed he had never qualified for exemption from British taxes as a non-resident and we understand he may be pursued for tax bills dating back to 1993, estimated at about 30 million pounds.
We have waited anxiously for this week's decision, following a court battle that has dragged on for years and it has confirmed our worst fears.
Evidently Mr Gaines-Cooper, 72, has a house in Henley-on-Thames, Oxfordshire, where he keeps his collection of paintings, classic cars and guns, but maintained he "fell in love" with the Seychelles in 1976 and bought a French-style plantation house there. The entrepreneur, who set up companies across the world insists he "made a break" with Britain in the 1970s and was based in the Seychelles but nevertheless despite his spending less than 91 days a year in Britain, HMRC pointed to his second wife and son living for some time on his Henley estate , with his son attending an English school such that the appeal court judges said that England had remained the "centre of gravity of his life and interests".
They concluded that Mr Gaines-Cooper had failed to show "a distinct break" from his social and family ties in the UK and his complaints of unfair treatment were based on an "impossible construction" of the law.
Two other businessmen, Robert Davies and Michael James, also lost appeals concerning their non-resident status at the Court of Appeal this week.
Mr Gaines-Cooper is seeking leave to appeal to the Supreme Court.
In one way we are extremely relieved that the advice we have given over the past few years with regards to making a clean break would, with hindsight, appear to have been correct - we based this on our fear that Gaines-Cooper would lose - as he has - but dismayed at the difficulty this case may cause people who retain property and social ties in the UK and believe they are free from UK taxes. Whilst we do not believe it applies to any of our clients, we are specially concerned that this could cause grave consequences for people with a foreign domicile who believe they have broken their deemed or acquired UK domicile by spending 4 years as non residents if it transpires their assumed period of non residence wasn't, following Gaines-Cooper!
If this concerns you please contact John Forbes for further advice or go to contact us.