How can you establish your UK tax residency status?

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Since the introduction of the statutory residence test it is now both simultaneously easier, and far more complicated to establish your UK tax residency status.

We have replaced a rather woolly system of ‘feeling’ like you’re a UK resident, or not, with that of a very rigid series of tests. Even though the tests themselves are long and detailed, they do give a clear unambiguous answer as to whether you were a UK tax resident in the year. It is thought that once you’ve grappled to the end of the residence tests, and got your answer, then that is the end of the story. That is not quite the case.

HMRC’s guidance stays virtually completely silent on the fact that the taxpayer may be dual resident and the final step in the tests is to revert to the double tax treaty which may have a tie-breaker clause assigning, in a final swipe of the sword, your residency elsewhere.

In an all or nothing outcome this last point is strangely silent for something so important. This is the concept of ‘Treaty non residence’ which is very little mentioned.

If you need help in establishing your UK tax residence status speak to Ellis & Co accountants in Chester to find out more.