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bigduckontax
bigduckontax, Accountant
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I have been workin overseas since April 2015. I came back to

Customer Question

I have been workin overseas since April 2015. I came back to the UK on 22 December. I spent 40 days in the UK. I was on holiday until 4 January 2016 and then had to spend 17 days working in my UK office until 26 January. I was on holiday on 27 and 28 January and travelled back to my overseas office on 31 January. Does this count as a significant break from overseas work? I satisfy the other requirements of the thirst statutory non residency test.
Submitted: 9 months ago.
Category: Tax
Expert:  bigduckontax replied 9 months ago.
Hello, I am Keith, one of the experts on Just Answer, and pleased to be able to help you with your question. First things first; when you left the UK in April 2015 did you send a Form P85 to HMRC? If you did not you should do so immediately. Fortunately there is no time limit as to its submission, it is available on the web and can be filed on line. On receipt HMRC will classify you as non resident for the tax year after your date of departure and furthermore split the leaving year into two portions, one resident and one non resident. As you left in April then for the majority of the 15/16 tax year you will be non resident. Once you have gone through the P85 process you can spend up to 91 days in the UK in any one tax year without breaching your non resident status. In theory the 91 days can be averaged over four tax years, but the general consensus of opinion amongst experts on this site is never to exceed the magic 91 days in any one tax year. You appear to have spent some 57 days in the UK in the 15/16 tax year so your classification as a non resident would remain. You will find dealing with HMRC much easier if you complete the P85 procedure. I do hope that my reply has been of assistance.
Customer: replied 9 months ago.
I left the UK in August 2014, but had already spent more than 91 days in the 2014-2015 tax year so was considered UK resident for 2014-2015. I satisfy the non residency test for this year, except for the clause I see on the HMRC website 'work full time overseas without a significant break from overseas work'.
My query is whether my 40 days in the UK between 22 Dec and 31 Jan will be considered a 'significant break in overseas work'
Expert:  bigduckontax replied 9 months ago.
If you complete the P85 process as I suggested then your time April - August will be resident and thereafter non resident. You have, however with your Festive Season stay, spent over 183 days in the UK in the 15/16 tax year and are thus subject to UK taxation on your world wide income, relieved, of course, by any appropriate Double Taxation Treaties. A 31 day rule applies to 'significant break from overseas work. You spent 40 days in the UK over Christmas so may well fall foul of your non resident status retention.
Customer: replied 9 months ago.
That's my interpretation so far, but I wondered about the wording around annual leave in relation to period away from overseas work. I was on annual leave from 22 Dec until 4 Jan. Does the 31 day meter start then or on the day I arrived back in the UK?
Expert:  bigduckontax replied 9 months ago.
Unfortunately, you cannot add the annual leave to the 91 day rule which can only be breached in exceptional circumstances like illness or bereavement of a near relative. However, the averaging of the 91 day rule may, in the longer term, save you from losing your non residential status. Days are calculated by the midnight hour. If you arrive at 2359 hrs on Monday, then Monday counts. If you leave at 2359 hrs then it does not.

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