Determining your UK tax residency status is the cornerstone of managing your tax affairs effectively. Whether you’re an internationally mobile professional, relocating expat, or UK citizen working abroad, the Statutory Residence Test (SRT) will dictate your tax obligations. This rigid, objective framework replaced the previous subjective tests in 2013, providing much-needed clarity for globally mobile individuals.
The SRT operates through three sequential stages: Automatic Overseas Tests, Automatic UK Tests, and the Sufficient Ties Test. If you qualify as a UK resident, you may also be eligible for Split Year Treatment, which can significantly reduce your tax burden by partitioning the tax year into taxable and non-taxable portions.
Part 1: Key Definitions & Day Counting
Understanding how the UK measures your presence is fundamental to applying the SRT correctly. The definitions below form the building blocks of every residency calculation.
What Constitutes a ‘UK Day’
The midnight rule is the primary determinant: a day counts as a UK day if you are present in the UK at the end of that day (midnight). This seemingly simple rule has important exceptions and anti-avoidance provisions.
The transit exception provides relief for departing travelers. If you leave the UK on an evening flight before midnight, that day typically does not count as a UK day, even though you were present earlier.
However, the deeming rule acts as an anti-avoidance mechanism. If you spend more than 30 days in the UK without being present at midnight: such as through repeated day trips: any subsequent days where you are present will be deemed “UK days” even if you leave before midnight. This prevents manipulation of the midnight rule.
Understanding ‘UK Workdays’
A UK workday is defined as any day where you complete three hours or more of work while physically present in the UK. This definition creates an important distinction: it’s entirely possible for a day to qualify as a “UK workday” (because you worked 3+ hours) but not count as a “UK day” (because you left before midnight).
Record-Keeping Requirements
Globally mobile individuals must maintain meticulous records. Flight details, accommodation receipts, work calendars, and location logs become crucial evidence if HMRC challenges your residency status. The burden of proof typically falls on the taxpayer to demonstrate their whereabouts, making contemporary record-keeping essential rather than optional.
Part 2: The Three-Stage Residency Test
The SRT must be applied sequentially. If you meet a test in Stage 1, you stop there. Only if you fail all Stage 1 tests do you proceed to Stage 2, and so forth.
Stage 1: Automatic Overseas Tests
Meeting any of these three tests makes you non-UK resident for the entire tax year:
Test 1 (Recent Leavers): You were a UK resident in one of the previous three tax years but spent fewer than 16 days in the UK this year. This test recognizes that individuals genuinely departing the UK shouldn’t be penalized by brief return visits.
Test 2 (Long-term Arrivers): You were not a UK resident in any of the previous three tax years and spent fewer than 46 days in the UK this year. The higher threshold acknowledges that individuals with no recent UK ties can have more extended visits without triggering residency.
Test 3 (Overseas Workers): You work full-time overseas (averaging 35+ hours per week), spent fewer than 91 days in the UK, and worked fewer than 31 UK workdays. This test protects genuine overseas workers from occasional UK business travel.
Stage 2: Automatic UK Tests
If you fail all overseas tests, these three tests can make you UK resident:
Test 1 (Day Count Threshold): You spend 183 days or more in the UK. This represents the traditional bright-line test: more than half the year in the UK establishes clear residency.
Test 2 (UK Home Test): You have a home in the UK for at least 91 consecutive days (with 30+ days falling within the tax year) and spend 30+ days there. Crucially, during this period you must either have no overseas home or spend fewer than 30 days in any overseas home.
Test 3 (UK Work Test): You work full-time in the UK for any 365-day period that overlaps with the tax year under consideration.
Stage 3: The Sufficient Ties Test
If you fail all automatic tests, your residency depends on combining your UK day count with your “ties” to the UK.
The Five Ties are:
- Family Tie: Your spouse, civil partner, or minor child is UK resident
- Accommodation Tie: Accommodation is available to you for 91+ days where you stayed at least one night
- Work Tie: You work in the UK for 40+ days (days with 3+ hours of work)
- 90-Day Tie: You spent more than 90 days in the UK in either of the previous two tax years
Your status as a “Leaver” (resident in the UK within the last three years) or “Arriver” (not resident for the last three years) determines your thresholds. Exceed these thresholds and you become a UK resident.
As a Leaver, the number of days in the UK and corresponding number of UK ties go as follows:
- 16–45 days in the UK → need at least 4 UK ties
- 46–90 days in the UK → need at least 3 UK ties
- 91–120 days in the UK → need at least 2 UK ties
- More than 120 days in the UK → need at least 1 UK tie
As an Arriver, the thresholds are stricter:
- 46–90 days in the UK → need all 4 UK ties
- 91–120 days in the UK → need at least 3 UK ties
- More than 120 days in the UK → need at least 2 UK ties
Part 3: Split Year Treatment
If you’re determined to be a UK resident for the tax year, Split Year Treatment can provide significant tax relief by dividing the year into a taxable “UK part” and a generally non-taxable “overseas part.”
Who Qualifies
You must meet one of eight specific cases, broadly divided into “leaving” and “arriving” scenarios:
Leaving the UK (Cases 1-3):
- Case 1: Starting full-time work overseas
- Case 2: Accompanying a partner who starts full-time work overseas
- Case 3: Ceasing to have a UK home while moving overseas
Arriving in the UK (Cases 4-8):
- Case 4: Establishing your only home in the UK
- Case 5: Starting full-time work in the UK
- Case 6: Ceasing full-time overseas work and returning to the UK
- Case 7: Accompanying a partner who ceases full-time overseas work
- Case 8: Starting to have a home in the UK (even while retaining an overseas home)
Strategic Benefits
The key advantage of Split Year Treatment is that income arising in the “overseas part” of the year (before arrival or after departure) is generally outside the scope of UK tax. This protection can save considerable tax for high earners relocating internationally, as it shields pre-arrival bonuses, overseas employment income, and foreign investment returns earned during the non-UK period.
Part 4: Additional Complications
Exceptional Days
You may exclude up to 60 days spent in the UK due to exceptional circumstances beyond your control, such as natural disasters, war, or sudden illness. However, elective medical treatment doesn’t qualify, only truly involuntary circumstances provide this relief.
Temporary Non-Residence Rules
If you leave the UK for fewer than five complete tax years and then return, certain gains realized while non-resident may become taxable upon your return. This anti-avoidance rule prevents individuals from briefly leaving the UK solely to realize gains tax-free.
Domicile and the Remittance Basis
Definition of domicile (practical): In UK law, your domicile of origin is generally the country your father was domiciled in when you were born. Your domicile can change (to a “domicile of choice”) if you move to another country and intend to live there permanently and indefinitely, without an intention to return to the UK. The concept is nuanced. See HMRC’s RDR1 guidance (chapters 5 and 9) and take expert advice before relying on a particular domicile position.
Foreign income and gains (FIG) and the remittance basis: If you are a UK resident but non‑domiciled in the UK, you may avoid UK tax on foreign income and gains that you do not bring (“remit”) to the UK. Where your total unremitted foreign income and gains are under £2,000 in a tax year, you may be able to use the remittance basis without having to complete a Self Assessment return unless you have other reasons to do so. If your foreign income/gains exceed £2,000, you must file a Self Assessment return and claim to be taxed on either:
- Arising basis: pay UK tax on your worldwide income and gains, or
- Remittance basis: pay UK tax only on foreign income and gains that you remit to the UK.
Implications of claiming the remittance basis:
- You might lose your UK Personal Allowance and the Capital Gains Tax Annual Exempt Amount for that year.
- An annual Remittance Basis Charge (RBC) can apply if you are a longer‑term UK resident: £30,000 if resident in at least 7 out of the previous 9 tax years; £60,000 if resident in at least 12 of the previous 14 tax years.
- Only amounts remitted to the UK are taxed, but “mixed fund” rules and the definition of a remittance are complex (for example, paying a UK credit card from an offshore account can be a remittance). Professional advice is strongly recommended.
Special cases and common reliefs:
- Foreign workers’ exemption (small amounts): In limited circumstances you may not need to complete a Self Assessment return if ALL apply: (1) your overseas employment income is less than £10,000; (2) your total overseas bank interest is less than £100; (3) you paid foreign tax on all your overseas employment income and interest; (4) you are within the UK basic rate band; and (5) you have no other reason to file. Check your position carefully against HMRC’s guidance.
- Overseas Workday Relief (OWR): Rules have evolved from 6 April 2025. If you’re claiming OWR on or after 6 April 2025, you’ll need to read Globally mobile employees — Overseas Workday Relief to check if you’re eligible. Under the new residence-based regime (known as the Foreign Income and Gains regime), relief will no longer be available on chargeable overseas earnings earned after 5 April 2025, unless they are qualifying foreign employment income for the purposes of Overseas Workday Relief.
- Foreign students: There are specific rules for students (for example, certain scholarships and overseas maintenance/gifts are not taxable; the remittance basis charge does not apply to those under 18, and the £2,000 de minimis can be relevant). Because student funding often involves overseas transfers, get tailored advice before remitting funds.
Inheritance Tax (IHT) and domicile: Domicile has separate IHT consequences, including “deemed domicile” rules (commonly after 15 out of 20 UK tax years). Estate and succession planning should consider these rules alongside income tax planning.
Key compliance actions for non‑doms:
- Keep clean and segregated offshore bank accounts (capital, income, gains) and detailed records of remittances.
- Register for Self Assessment where required and complete the SA109 Residence/Domicile pages each year you claim the remittance basis.
- Consider whether the arising basis or remittance basis gives the better overall result after loss of allowances and any RBC.
- If claiming OWR, maintain day‑by‑day work records, ensure correct payroll/payment arrangements, and obtain employer support.
- Take advice early, particularly if you are close to the £2,000 de minimis, contemplating significant remittances, or approaching the RBC thresholds.
Next Steps and Professional Guidance
The SRT’s apparent objectivity masks significant complexity in practice. A single day miscounted or an incorrectly assessed tie can shift you from non-resident to resident status, potentially triggering substantial tax liabilities.
Essential Action Points:
- Maintain precise records: Document your location at midnight for every day of the tax year, including supporting evidence like flight confirmations and hotel receipts.
- Monitor borderline cases: If your day count approaches the thresholds or you’re relying on Split Year Treatment, seek professional advice before filing.
- Understand the definitions: “Full-time work” calculations, “home” definitions, and tie assessments involve nuanced interpretations that can determine your residency status.
Given the complexity of these rules and their potentially significant financial consequences, internationally mobile professionals should engage expert tax advisors early in their planning process. At Del Canto Chambers, we advise clients on UK tax residency strategies, ensuring compliance while optimizing their tax position across multiple jurisdictions.
The stakes are too high, and the rules too intricate, to navigate alone.
