New UK residence travel rule
Frequent travellers to the UK will find it more difficult to avoid being taxed as UK residents from 6 April 2008.
In the past, HM Revenue & Customs has not included the days of arrival and departure when totting up the number of days someone has spent in the UK in a tax year. But this is about to change.
The number of days spent in the UK is important when deciding whether you are resident in the UK for tax purposes. There are two main tests that involve counting days:
- Anyone who is present in the UK for more than 182 days in a tax year is automatically resident.
- Regular visitors to the UK will be treated as UK residents if they spend on average more than 90 days a year in the country over four tax years.
Being treated as resident in the UK in any year could have consequences beyond that year if you are not UK domiciled. In particular, it will hasten the day when you are deemed to be UK domiciled for inheritance tax purposes, exposing your worldwide estate to UK tax.
Determining your residence status can be complex and involves factors other than days in the UK. We can advise you on how to avoid any nasty surprises.
