United Kingdom Statutory Residency Test ("SRT")

Whether you’re UK resident or not is important for tax purposes. Your residence status affects how much tax you pay and where you pay it.

Non-residents only pay tax on their UK income - they do not pay UK tax on their foreign income. Residents normally pay UK tax on all their income, whether it’s from the UK or abroad.

Whether you’re UK resident usually depends on how many days you spend in the UK in the tax year (6 April to 5 April the following year).

Under the Statutory Residency Test, you’ll only be resident in the UK for tax purposes if both of the following apply:

• you meet one or more of (i) the automatic UK tests or (ii) the sufficient ties test
• you do not meet any of the automatic overseas tests

Otherwise, you’ll be non-resident in the UK for tax purposes. These rules are set forth in the UK Statutory Residence Test ("SRT") introduced in the Finance Act 2013. The SRT allows you to work out your residence status for a tax year.

UK tests

You may be resident under the "automatic UK tests" if:

• you spent 183 or more days in the UK in the tax year (for this purpose presence in the UK at midnight generally counts as a day in the UK)
• your only home was in the UK for 91 days or more in a row - and you visited or stayed in it for at least 30 days of the tax year
• you worked full-time in the UK for any period of 365 days and at least one day of that period was in the tax year you’re checking

You may also be resident under the "sufficient ties test" if you spent a number of days in the UK and you have additional ties to the UK, like work or family.

Overseas tests

You may be non-resident under the "automatic overseas tests" if:

• you spent fewer than 16 days in the UK in the tax year (or 46 days if you have not been a UK resident for the 3 previous tax years)
• you worked abroad full-time (averaging at least 35 hours a week), and spent fewer than 91 days in the UK, of which no more than 30 were spent working

Sufficient Ties Test

If you do not meet the automatic overseas tests or the automatic UK tests, you must use the "sufficient ties test" to determine your residence status. This test compares the number of days you spent in the UK against the number of ties you have to the UK. The more ties you have, the fewer days you can spend in the UK without becoming a resident.

The ties are defined as follows:

• Family Tie: You have a spouse, civil partner, or minor child resident in the UK.
• Accommodation Tie: You have a place to live in the UK that is available to you for a continuous period of at least 91 days, and you spend at least one night there during the tax year.
• Work Tie: You work in the UK for at least 40 days during the tax year (working for more than 3 hours a day counts as a work day).
• 90-Day Tie: You spent more than 90 days in the UK in either of the two previous tax years.
• Country Tie: (Applies only to "leavers") You spend more days in the UK than in any other single country during the tax year.

Conclusion

Determining your UK tax residency status can be complex, involving automatic tests and a detailed analysis of your ties to the UK. Accurate day counting is the foundation of this analysis.

The Domicile365 App simplifies this process by providing precise, automated day count tracking to help you monitor your status under the Statutory Residence Test.

Take control of your tax planning and ensure compliance by downloading the Domicile365 App today for Apple iOS or Google Android.

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