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HM Accountax Ltd
HM Accountax Ltd, Chartered Certified Accountant
Category: Tax
Satisfied Customers: 301
Experience:  I am an accountancy professional with more than10 years hand on experience in audit, accountancy and tax affairs.
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I work as an IT consultant/software developer remotely. I'm

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Hi, I work as an IT consultant/software developer remotely. I'm a sole trader and do my work online. In the 2019/2020 and also 2020/2021 tax years I have not been in the UK but have been travelling around many countries whilst working
JA: Have you talked to a tax professional about this?
Customer: I need some advice about if I need to pay UK tax
JA: For which tax year do you need advice?
Customer: 2019/2020
JA: Anything else you want the Accountant to know before I connect you?
Customer: no

Hello, I am one of the experts on Just Answer and pleased to be able to help you with your question.

When you left the UK in 19/20 did you send a Form P85 to your UK tax office?

Customer: replied 4 days ago.
Hi, I'm not sure if it was the P85, but I know I am unregistered to pay tax this year on the HMRC website
Customer: replied 4 days ago.
Hi, I'm not sure if it was the P85, but I know I am unregistered to pay taxes this year on the HMRC website
Customer: replied 4 days ago.
Just to add some context:My main client is UK based, and I do get paid into a UK bank account.My understanding was that because the UK tax system is residency based and I pass the "first automatic overseas test" by being out of the country (not even a single day) then I was exempt.The confusion I have is that I'm also not tax resident anywhere else either. I'm traveling and moving every couple of months country to country. I worried they would try to say something like I'm a defacto tax resident despite the SRT test
Customer: replied 4 days ago.
I'm happy to have a call and pay, but I need to know you have expertise in this kind of situation (nomad lifestyle/expats and uk tax situation for freelancers) and that the answer will be solid

It is unfortunate, but you cannot just swan around the world and not pay tax anywhere.

Regrettably, I am of the opinion that you will be taxed in the UK on your world wide income.

Customer: replied 4 days ago.
Do you have any basis for that belief, however? If I have to pay, I have to pay. However, it also seems silly to be paying tax to a country I did not set foot in for almost 2 years when that country operates a residency-based tax system. The only info I see on HMRC pertaining to this is the SRT test. According to that test, I am a "non-tax resident" owing to not spending more than 16 days within the UK and having no other ties such as property ownership there.As far as I can see I am not eligible for taxes based on this, however, if there are some laws I am not aware of or precedent in court cases for such situations I would be very interested to know about it.Again I'm happy to pay for this advice if it taxes some time to dig into. I just need at this point something more than opinion as getting it wrong either way would be costly.
Customer: replied 4 days ago.
The only reason I doubt this belief is because I think the UK system did not yet catch up to the idea that people can live and work remotely in perpetual travel. As oppose to it being the case that since I must have left the UK I now must be tax-resident somewhere else (e.g. 183 days + in Spain if I truly went to live there).I wonder if there is some court case or other law, which HMRC would use. Perhaps saying "you are de facto taxable here because you are not paying elsewhere..." I don't know

I have given you my opinion and am not inclined to deviate therefrom.

Customer: replied 4 days ago.
Yeah, but opinion isn't really what I'm looking for when I think about hiring a paid consultant, evidence-based and well-substatiated research is.

Hi,

I am an advisor at JA and happy to assist you.

In order to help you, we’ll need you to provide answers to the following questions. We are assuming the latest tax year ended on 5th April 2020.

  • How many days were you resident in the UK in the last full tax year between 6th April 2019 and 5th April 2020?
  • How many days were you in the UK in the previous tax year between 6th April 2018 and 5th April 2019?
  • How many days were you resident in the UK in the tax year between 6th April 2017 and 5th April 2018?
  • How many days did you work in the UK (a working day means more than three hours per day) in each of the above tax years?
  • How many days did you work overseas (a working day means more than three hours per day) in each of the above tax years?
  • Did you have a UK home between in the tax year between 6th April 2019 and 5th April 2020? If yes, for how many days?
  • Did you have an overseas home in the tax year between 6th April 2019 and 5th April 2020? If yes, for how many days?
  • What date did you arrive in the UK?
  • What date did you leave the UK?
  • Where were you born?
  • Where were your parents born?
  • When are you likely to return to the UK?
  • Where do you consider to be your current permanent home?
  • Do you have any family or work ties in the UK?

Regards

HMAT

Customer: replied 4 days ago.
HIHow many days were you resident in the UK in the last full tax year between 6th April 2019 and 5th April 2020?
10How many days were you in the UK in the previous tax year between 6th April 2018 and 5th April 2019?
6months (I registered and paid taxes for this tax year in Jan 2020)How many days were you resident in the UK in the tax year between 6th April 2017 and 5th April 2018?
0How many days did you work in the UK (a working day means more than three hours per day) in each of the above tax years?
0How many days did you work overseas (a working day means more than three hours per day) in each of the above tax years?
I worked fulltime overseas in 2019/2020 and 2017/2018 (30-35hrs per week 48 weeks of the year).
In 208/2019 I worked the other 6 months of the year overseasDid you have a UK home between in the tax year between 6th April 2019 and 5th April 2020? If yes, for how many days?
NoDid you have an overseas home in the tax year between 6th April 2019 and 5th April 2020? If yes, for how many days?
NoWhat date did you arrive in the UK?
Born thereWhat date did you leave the UK?
October 2019 after 10 days trip there.Where were you born?
UKWhere were your parents born?
UKWhen are you likely to return to the UK?
After April 2021 for a short visit (a few days) maybe, but I have no plans to return there to stay longer/live thereWhere do you consider to be your current permanent home?
I move around frequently and work online, every 2-3 monthsDo you have any family or work ties in the UK?
My family is there. I don't work there. I work as a freelancer online from a variety of countries throughout the year, but
one of my clients is a UK based startup and they pay into a UK bank account

Hi,

Based on your answers, It indicates that you are non-resident. However, If HMRC looks into it might have different opinion. I have checked but couldn't find any case law on this scenario.

I'll recommend that you submit P85 to HMRC and make sure you have records of your arrival and leaving the UK etc.

I hope this answers the query.

If you have any further queries then please feel free to contact me.

Regards

Muhammad

HM Accountax Ltd, Chartered Certified Accountant
Category: Tax
Satisfied Customers: 301
Experience: I am an accountancy professional with more than10 years hand on experience in audit, accountancy and tax affairs.
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