Residence is defined by the Oxford English Dictionary as “the fact of living in a particular place”.
A person’s residence (for tax purposes) determines what income is subject to UK Income Tax.
UK Non-residents are subject to UK Income Tax only on their UK Income and Capital Gains made on the disposal of UK Land and Property,
whereas UK Residents are liable for UK Income Tax on all income, even if income is from outside the UK.*
In most cases, an individual’s residence status can be determined quite easily.
UK residence is usually determined on how many days are actually spent in the UK during a tax year (6th April to the following 5th April).**
An individual is automatically UK resident if:
183 days were spent in the UK in the tax year.
they have no overseas home, and they had a home in the UK for at least 91 consecutive days (whether owned, rented or lived in),
and spent at least 30 days in that home.
There are a couple of other automatic UK residence tests, and details of these can be found in Guidance Note RDR3: Statutory Residence Test notes.
If you wish to review this Guidance Note, you can click here
to open the relevant page on the HMRC site. Once reviewed, you can close the window and you will be back on this page.
An individual is automatically non-resident in the UK if:
less than 16 days were spent in the UK, if UK resident for at least one of the previous three tax years, increasing to 46 days if the
individual had been non-UK resident for the previous three tax years.
they work full-time (at least 35 hours per week) outside the UK and spent less than 91 days in the UK during the tax year, with
less than 31 days working more than three hours. There must be no significant break from the overseas work.
An individual’s circumstances may be more complicated, and their residence status may be harder to ascertain. If this is so, it may be necessary
to apply the Statutory Residence Test (SRT). HM Revenue and Customs have published Guidance Note RDR3: Statutory Residence Test notes.
If you wish to review this Guidance Note, you can click here
to open the relevant page on the HMRC site. Once reviewed, you can close the window and you will be back on this page.
The Statutory Residence Test came into effect on 6th April 2013.
Split Year Treatment
If an individual leaves or arrives in the UK on any other date than 6th April (the start of the UK tax year)**, the tax year is split into
two parts: a resident part and a non-resident part. This is referred to as ‘split year treatment’.
To check if an individual qualifies for Split Year Treatment, reference should be made to the Statutory Residence Test. Details can be found in Guidance Note
RDR3: Statutory Residence Test.
If you wish to review this Guidance Note, you can click here
to open the relevant page on the HMRC site. Once reviewed, you can close the window and you will be back on this page.
*Please note that this does not apply if an individual is not domiciled in the UK, even though they might be resident. A discussion of domicile and the
treatment of non-domiciled individuals is outside the scope of this website. If you wish to receive information on this subject, please
click click here to open our contact page in a new window. You can then fill in some details, write a short comment
(eg please send me information about UK domicile), and submit. Once submitted, you can close the window and you will be back on this page. We will contact you as soon as
possible.
**If you are interested in finding out why the UK tax year starts on 6th April
and ends on the following 5th April, click here
to open a new window to a Wikipedia page. When you have reviewed this, you can close the window, and you will be back on this page.
