Determining Non-Residency Status

As of April 6, 2013, specific tests are in place to ascertain whether you are a resident in the UK. These tests include the automatic overseas test and the automatic UK test.

Automatic Overseas Test:

You are considered non-resident if:

1. You were a UK resident in any of the previous three tax years and spend fewer than 16 days in the UK in a tax year.
2. You were not a UK resident in each of the previous three years and spend fewer than 46 days in the UK in a tax year.
3. You leave the UK for full-time work abroad, spending fewer than 91 days in the tax year in the UK, with less than 31 days working for more than 3 hours in the UK.

Automatic UK Test:

You are treated as resident if:

1. You spend 183 days or more in the UK in a tax year.
2. You have a UK home for over 90 days, spend at least 30 separate days in that home during a tax year, and experience a period of 91 consecutive days (some of which fall in that tax year) without a home overseas or if you have a home but haven’t spent more than 30 days in any one overseas home.
3. You engage in full-time work (over 3 hours per day) for 365 days or more without a significant break (at least 31 days), with over 75% of those workdays in the UK.

If you don’t meet either of the automatic tests, factors such as family ties, accommodation, substantive employment/self-employment in the UK, UK presence in the previous year, and more time in the UK than in other countries are considered.

Impact of Non-Residency

As a non-resident, you’re generally taxed only on income received in the UK, except for income earned for the Crown, which is taxable in the UK regardless of where it’s earned. Some income from the UK may be taxed in your country of residence due to double tax treaties.

Regarding property, if you dispose of a residential property in the UK after April 5, 2015, or a non-residential property after April 5, 2019, you’re liable for Capital Gains Tax (CGT). You may qualify for Private Residence Relief and annual exemption against the gain. You have options regarding how to calculate the gain, with elections being irrevocable once made.

If you’re non-resident for fewer than five full tax years, capital gains made on assets other than specified properties may be taxed in the year of your return, unless those assets were acquired and disposed of while you were non-resident.

A CGT return and tax payment must be made within 60 days of completing the sale, regardless of whether you file a self-assessment return. Confirm your tax obligations with a local tax advisor in your country of residence.