UK Tax Residency and the Statutory Residence Test (SRT)

Vocabulary flashcards covering the UK Statutory Residence Test (SRT), specific tie criteria, and the tax implications for residents and non-residents.

Statutory Residence Test (SRT)

The multi-step assessment used to determine UK tax residency for each tax year based on automatic overseas tests, automatic UK tests, and the sufficient ties test.

Tax Year (UK)

The period for which UK tax residency is evaluated, running from $6 \text{ April}$ to $5 \text{ April}$.

Automatic Overseas Test (Recent Resident)

You are non-resident if you were resident in one or more of the preceding $3$ tax years and spend $< 16$ days in the UK.

Automatic Overseas Test (Non-recent Resident)

You are non-resident if you were resident in none of the preceding $3$ tax years and spend $< 46$ days in the UK.

Full-time overseas work (SRT Criteria)

A condition for automatic non-residency involving working an average of $\thickapprox 35 \text{ hours per week}$ overseas, spending $< 91$ days in the UK, and spending $< 30 \text{ working days}$ in the UK.

Automatic UK Residence (Day Count)

A person is automatically a UK resident if they spend $\text{≥ } 183$ days in the UK during a tax year.

Automatic UK Residence (Home Criteria)

Being a resident by having an only home in the UK for at least $91 \text{ consecutive days}$ and staying there for more than $30$ days during the tax year.

Automatic UK Residence (Work Criteria)

Being a resident by working full-time in the UK for a continuous $365 \text{-day period}$, where at least one day falls in the current tax year.

Sufficient Ties Test

The third part of the SRT used when automatic tests do not apply; it balances the number of days spent in the UK against specific ties including family, accommodation, work, presence, and country ties.

Family Tie

A tie established if a spouse, civil partner, or minor children live in the UK.

Accommodation Tie

A tie established by having accommodation available to use for $\text{≥ } 91$ days in the tax year.

Work Tie

A tie established by working in the UK for $\text{≥ } 40$ days in the tax year, with each day consisting of at least $3 \text{ hours}$ of work.

90-day Tie

A tie established by being present in the UK for $\text{≥ } 90$ days in either of the previous two tax years.

Country Tie

A tie applying only to 'leavers' where the individual is present in the UK at midnight more than in any other single country.

Tax Basis for Residents

Individuals who normally pay UK tax on all their worldwide income and capital gains.

Tax Basis for Non-residents

Individuals who usually only pay UK tax on income arising in the UK.

New Resident Election (Post-April 6, 2025)

Individuals who have been UK tax resident for $4$ years or less can elect to be taxed only on UK income and gains.

Long-term resident (Inheritance Tax)

An individual resident in the UK for $> 10$ of the previous $20$ tax years, making them subject to UK Inheritance Tax on worldwide assets.