Cross-Border Tax Issues: How Ecovis Helped a Client Recover Overpaid Tax

The Challenge

Our client was a partner in a UK-based training business but was resident overseas. While they regularly travelled to the UK to deliver training programmes, their primary tax residence remained in their home country.

Like many people facing cross-border tax issues, the client relied on professional advice to navigate their UK tax obligations. However, a later review by the tax authority in their home country highlighted a problem. They interpreted their Double Taxation Agreement with the UK in a way that meant that the individual’s worldwide income was taxable only in their home state, yet, for several years they had been paying UK tax only on a sizeable proportion of the same earnings.

This created a complex situation involving two tax jurisdictions with the home state allowing no credit for the tax paid in the UK because by their interpretation, it should not have been paid at all. The client needed specialist advice to understand their position and identify the best route forward.

How We Helped

The client approached Ecovis for assistance with these cross-border tax issues.

Our UK Private Client Tax team worked closely with colleagues from an Ecovis member firm in the client’s country of residence to review the situation. Together, we established how the relevant double taxation rules applied and confirmed that the income in question should not have been subject to UK tax.

Drawing on expertise from both jurisdictions, we developed a strategy to correct the client’s tax position. This included:

• Preparing amended UK Self Assessment tax returns where amendments were still possible.
• Submitting carefully drafted Double Taxation Treaty Relief claims to HMRC.
• Making Overpayment Relief claims for earlier tax years.
• Liaising with HMRC to ensure the claims were supported by clear technical evidence and appropriate documentation.

This collaborative international approach enabled us to address the client’s cross-border tax issues in a coordinated and efficient manner.

The Results

HMRC accepted the claims and agreed that the tax had been paid in error.

As a result, the client received repayment of the full amount of UK tax that had been incorrectly charged, representing a significant financial benefit.

Just as importantly, the client gained clarity and confidence that their tax affairs were correctly aligned across both jurisdictions moving forward.

This client story demonstrates the value of seeking specialist advice when dealing with cross-border tax issues. It also highlights the advantage of working with advisers who can access trusted expertise in multiple countries through an established international network.