United Kingdom: UK Statutory Residence Test Flowchart
From 6 April 2013 an individual’s residence status for UK tax is determined using the statutory residence test (SRT).
The SRT flowchart overleaf is designed to assist in determining the residence status of individuals. The legislation and guidance is lengthy and the flowchart and notes can only give a brief summary of the key points. In particular, the flowchart gives only an indication of residence and should not under any circumstances be relied upon to determine UK residence status.
In certain circumstances, the tax year can be split, with the individual being UK resident for part of the year and non-UK resident for the remainder. Detailed advice on split year treatment is essential, if relevant.
Determination of residence status is complex and monitoring of any change in circumstances is required on an ongoing basis. The definitions of these circumstances are listed below. Relevant changes in your circumstances, such as acquiring accommodation, that need to be considered as part of the SRT decision making should immediately be notified to your usual contact at Smith & Williamson (if you would like us to monitor your residence status).
Key definitions:
Tax Year: 6 April in one year to 5 April in the following year.
Days in UK: A UK day is one where the individual is in the UK at midnight. Days in the UK can be ignored in very limited exceptional circumstances, as can transit days. ‘Deemed’ UK days can be added for leavers with three ties or more.
Full time work: 35 hours per week on average with no significant breaks. Working hours are calculated after adjusting for ‘disregarded days’, gaps between employment, etc.
A working day: More than three hours in the UK or abroad.
Significant break from work: At least 31 days during which none of the days is: a day on which an individual works more than three hours; or a day when he would have worked more than three hours if he had not been on annual, sick or parenting leave.
Accommodation: A place to live. Can include a holiday, weekend or hotel room (stay of at least one night) or a close relative’s home (stays total at least 16 nights in tax year).
Home: Does not include a place used periodically, e.g holiday home or temporary retreat. A property being let commercially will not be a home unless it is available to use under the leasing arrangement.
Visits: If any time is spent in a home, however short, this counts as a visit.
Minor child and ties: Child under 18 will be a tie in the UK unless they are in the UK solely for the purposes of their education, in full time education and spend fewer than 21 days in the UK outside term time (half terms count as term time).
If you are present in the UK for ≥ 183 days in a tax year, you are UK resident.
