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TonyTax
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I was non-resident purposes from tax year 2007/2008

Resolved Question:

I was non-resident for tax purposes from tax year 2007/2008 until 2012/2013 inclusive. I left my overseas (Hong Kong) employer on 23rd December 2013, and returned to the UK on 8th February 2014. I as in the UK for a total of 61 days during the tax year 2013/2014, and did no work on any of those days.
Under the "old" rules I was non-resident in 2013/2014 because I spent (much) less than 183 days here. But these new rules (which I only discovered today) have confused and seriously worried me.
Was I "accidentally" resident in the UK in 2013/2014 please? And if so, am I liable for UK tax on my earnings in Hong Kong, on which I paid my HK tax in full?
Many thanks for your help
Submitted: 2 years ago.
Category: Tax
Expert:  TonyTax replied 2 years ago.
Hi.

I'm assuming that you are a UK national.

Take a look at RDR3 here, the notes here and the flowchart for an arriver here.

Under the new statutory residence test rules, an individual is either tax resident or not tax resident in the UK for the whole tax year. By definition, if they are not UK tax resident for a tax year, they won't pay UK tax on non-UK income. If they are UK tax resident for the year in which they arrive in the UK, they will almost certainly qualify for split year treatment which means that non-UK income for the period before their arrival in the UK will not be taxed in the UK whereas income post arrival will be subject to UK tax.

You need to go through the tests to determine your status which is very straightforward. Either way, I cannot see you paying UK tax on your HK income.

Even in the unlikely event that the HK income was taxable in the UK, you would get relief for tax paid on that income in HK against your UK tax liability but as I said above, I very much doubt you will have to pay UK tax especially since you arrive so late in the tax year and because of the split year treatment rule.

I hope this helps but let me know if you have any further questions.
Expert:  TonyTax replied 2 years ago.
I have to go out for a short while but I will be back this evening to answer any follow up questions that you may have.
Customer: replied 2 years ago.

w

Customer: replied 2 years ago.

OK. Many thanks for your answer. It appears to me that I am actually resident in 2013/2014 under the new rules, because I was in the UK for more than 46 days in the tax year.

However, based on the flowchart you sent me, I qualify without doubt for split year treatment - and I had zero earned income after my arrival back in the UK. I understand that this means that I will not have to pay any UK tax at all on my HK earnings. Please correct me if I am wrong.

I assume, therefore, that I should not check Box 1 on the Residence page, which declares that I was non-resident in 2013/2014, but that i should check the box that says I qualify for split year treatment.

The same applies, I assume, to my wife, who was with me in HK and came back with me, but who had no earnings in HK. It doesn't really matter in her case, because she only has UK income well under her personal allowance anyway - or would it be OK not to even include the Residence page on her return, please?

Many thanks. You're well on course for the smiliest of faces!

PS: Yes, I am a UK national; so is my wife.

Expert:  TonyTax replied 2 years ago.
You are correct in your understanding on every point.
TonyTax, Tax Consultant
Category: Tax
Satisfied Customers: 15835
Experience: Inc Tax, CGT, Corp Tax, IHT, VAT.
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