Tax questions

The UK introduced a statutory residence test (SRT) on 6 April 2013. You are physically resident in the UK for more than 182 days in a tax year you will be regarded as tax resident in the UK. otherwise you need to consider the automatic overseas, the automatic UK, and the sufficient ties elements of the SRT.=

Where you are domiciled is the country in which you originated or have settled in permanently. The domicile at birth starts, generally, from the father’s domicile (domicile of origin), but can be changed if the individual settles permanently elsewhere (a domicile of choice). You can also be deemed domicile under new HMRC rules.

Please note that UK citizenship does not necessarily mean you are UK domiciled. Ask us to review your UK domicile status.

Yes, you can be tax resident in the UK under the UK domestic SRT and also tax resident in another country under their domestic residence test.

In such circumstance you may look to apply the Double Tax Treaty Residence Article to determine where you are regarded as treaty resident. This ensures that you generally don’t pay full tax twice on the same income or capital gains

If you have a UK sourced income (eg UK BTL property, tailing UK employment income etc). You have a UK tax return filing requirement for any income that arises on the UK even though you may be non UK tax resident.

You must file a non resident UK tax return to report your UK income and pay any applicable taxes. If you are also taxable on this income in HK you will be able to claim a foreign tax credit on any UK taxes paid to mitigate double taxation

As a non UK domiciled individual you can be taxed on the arising basis or remittance basis.

Arising basis means you are taxed on your worldwide income and gains. Foreign tax credit can be claimed to mitigate double taxation. You keep the personal allowance (subject to the income limits where this is abated)

Remittance basis means you are taxed on you UK income only and none o your overseas income is taxed unless remitted to the UK. However, if your overseas income and gains is over £2,000 pa you lose the tax free personal allowance and CGT annual exemption to make the emittance basis claim.

The remittance basis or arising basis will apply to all income, and cannot be allocated between each source of income in the tax year.

If you are resident for 7 out of previous 9 tax years the Remittance Basis Charge (RBC) will apply to use the Remittance Basis. This is £30,000 charge per tax year.

Please also see Condition B deemed domicile rules that will apply for longer term UK tax residence. You will then be subject to tax on the arising basis of taxation.

The election must be made each year on your UK tax return.