What is the difference between residency and domicile?
In today’s global economy, individuals need to understand their exposure to UK tax and National Insurance as they come to or leave the UK, or divide their time between two (or more) jurisdictions.
In establishing your exposure to UK tax, you need to consider your country of residence and domicile.
The Statutory Residence Test (SRT) has been in force since 6 April 2013. It applies a series of tests taking into account days spent in the UK and overseas, work patterns and connections with the UK in order to establish your UK residence position for a given tax year.
The SRT is complex but, if followed correctly, provides certainty as to your UK residence status. HMRC’s guidance on the matter covers over 100 pages and we can assist you in establishing how the rules apply to your individual circumstances.
Your domicile is broadly where you have your permanent home and where you belong. It is where, whenever you are absent, you ultimately intend to return. If you are not domiciled in the UK, you may be able to benefit from a number of tax advantages.
From 6 April 2017 new deemed domicile rules came into force. These rules mean that you are treated as domiciled in the UK for all tax purposes once you have been UK resident for at least 15 of the last 20 tax years.
We offer advice in the following areas:
- Establishing your UK residence status and advising you on your exposure to UK taxes.
- National Insurance obligations on coming to or leaving the UK.
- Non-residential Capital Gains Tax.
- Double tax relief claims, including foreign tax credits and treaty exemption.
- Establishing your actual and deemed domicile status.
- Claiming the remittance basis and paying the remittance basis charge.
Please contact our tax team on 01223 810100 to discuss your residence and domicile status.