Find A Quick Way To TOP QUALITY RESIDENCES

The government is proposing new rules that come to effect from 6 April 2013 that may put UK residence for tax purposes on a statutory footing, rather than counting on HMRC guidelines and case law. In principle this can be a sensible move and can provide certainty for anyone unsure at present whether they qualify as being non-resident in the united kingdom for tax purposes. However the rules are complex and have attracted some criticism because of this.

Under the current rules you are resident in the UK in the event that you spend 183 days or more in the UK and you also could be resident if you spend more than 90 days on average. Beneath the new rules you will see no more four-year average and if you spend more than 90 days in the UK in any tax year you will always be considered to be resident. As before, you should be away from the UK for a whole tax year as a way to qualify as non-resident and each day counts as being a day on the UK if you are at midnight on that day.

However, the new law is generally designed to leave most people in exactly the same position as previously so you are unlikely to find your position suddenly altered. Ki Residences Singapore It is vital though that you understand the new test of residence and non-residence. There are three parts of the test that have to be considered to be able. In other words, when you are definitely non-resident on the basis of Part A, then you don’t have to consider parts B and C.

So, we think most of our clients should be still included in the provision in Part A that you are non-resident should you have left the UK to handle full-time work abroad and are present in the UK for fewer than 91 days in the tax year no a lot more than 20 days are spent employed in the UK in the tax year. Here though will be the three parts of the test.

Part A: You are definitely non-resident if:

You were not resident in the united kingdom for the previous 3 tax years and present in the UK for under 46 days in today’s tax year; or You’re resident in the UK in one or more of the previous 3 tax years but present in the UK for less than 16 days in the current tax year; or You have gone the UK to handle full-time work abroad and provided you’re present in the united kingdom for less than 91 days in the tax year and no a lot more than 20 days are spent working in the UK in the tax year. Training paid for by your employer and used the UK will be considered work and this will undoubtedly be taken from your 20 day working allowance.

Part B: You’re definitely resident if:

You are present in the united kingdom for 183 days or more in a tax year; or You have only one home and that home is in the UK or have more homes and all of these are in the UK; or You carry out full-time work in the united kingdom.

Part C: If your situation isn’t described in Parts A and B you then need to compare the amount of days spent in the UK against a small number of clearly defined connection factors. These connection factors are the following:

Family- your partner or civil partner or common law equivalent (provided you aren’t separated from them) or minor children are resident in the UK. Accommodation – you have accessible accommodation in the UK and makes use of it through the tax year (at the mercy of exclusions for some forms of accommodation). Substantive work in the UK – you do substantive work in the UK i.e. more than forty days in the tax year but usually do not work full-time in the united kingdom. UK presence in previous years – you spent a lot more than 90 days in the UK in either of the prior two tax years and you also spend more days in the united kingdom in the tax year than in any other single country.

These connection factors are then combined with day counting to determine whether you’re resident or non-resident. You can find two categories, arrivers and leavers.

If you were not resident in any of the prior three tax years – ‘Arrivers’:

Less than 46 days in UK: Always non-resident. 46 – 3 months: Resident if 4 or more connection factors. 91 – 120 days: Resident if 3 or more connection factors. 121 – 182 days: Resident if 2 or even more connection factors. 183 days or even more: Always resident.

If you were resident in a single or even more of the three tax years immediately before the tax year under consideration – ‘Leavers’:

Less than 16 days in UK: Always non-resident. 16 – 45 days: Resident if 4 or even more connection factors. 46 – 90 days: Resident if 3 or more connection factors. 91 – 120 days: Resident if 2 or even more connection factors. 121 – 182 days: Resident if there are 1 or more connection factors. 183 days or even more: Always resident

Once the Finance Bill is produced there could be some changes to the legislation and much more detail may emerge, but there’s been considerable consultation in fact it is sensible to prepare for the brand new rules now. If this is relevant to your situation you should take professional advice to ensure you don’t fall foul of the brand new legislation.