UK Statutory Residence Test

The UK authorities are changing the rules on tax residence.  They are introducing a statutory test to determine whether individuals are resident in the UK for tax purposes.  The UK tax rules around residence always provokes an interesting discussion, particularly offshore.

Please click here to view a brief summary of the new rules.

The test brings some much needed certainty to this area however it is difficult to apply an objective standard to an area as inherently subjective as residence.  On looking at the draft law and discussing real situations we are coming across a  number of practical issues for those people with UK connections.  It is important that people with UK connections are aware of the practical implications of the new rules.  

A selection of the issues we are discussing with people are as follows:

  • Exactly when does work begin and what is work
  • What constitutes available accommodation, how often can hotels be used, holiday homes?
  • The concept of a home versus available accommodation
  • The impact of children at boarding school
  • The impact of a spouse or partners residence position
  • The impact of a new partners children's residence position on your residence
  • Relationships starting or ending with people UK resident for any part of the year
  • The impact of the new day deeming rule for those individuals with 3 UK ties who have left within the last 3 years

If you would like to discuss the new rules, please do not hesitate to use the contact details on this page to contact Garry Bell or Rebecca Turnbull or speak to your usual PwC contact.