UK Statutory Residence Test Does Away with Grey Areas

Marinelink.com
Friday, April 05, 2013

International accountant and shipping adviser Moore Stephens says the introduction by the UK of a statutory residence test will bring much greater certainty to an area previously decided largely on the basis of case law and government practice.



The UK is introducing the statutory residence test with effect from 6 April, 2013.  Gill Smith, a tax partner with Moore Stephens, explains, “At present, there is no statutory definition of residence, but rather case law and HMRC practice.  This has resulted in residence being a rather grey area, but the new test should bring much greater certainty.”



Under the new test, individuals will always be resident if they spend 183 days in the UK.  As is the case now, a day counts if the individual is in the UK at midnight.  Automatic residence is also achieved if individuals are working in the UK full-time or, broadly, have their only home there.



Individuals are automatically non-resident if they are in the UK for less than 46 days in the tax year.  This limit is restricted to less than 16 days for an individual who has been UK-resident for one or more of the preceding three tax years.  Additionally, individuals are non-resident if they work full-time abroad.



For individuals who are neither automatically resident nor non-resident, there is a ‘sufficient ties test’.  The legislation sets out a number of ties, and the number of days in the UK that would make individuals UK-resident for a tax year is calculated according to the number of ties they have. For arrivers (individuals who have not been resident in the UK in any of the three previous tax years) the ties are: having family resident in the UK (family includes a spouse, partner or minor children); having accommodation available and using it for one night in the tax year; working in the UK for 40 or more days in the tax year for at least three hours per day; having been present in the UK for more than 90 days in either of the previous two tax years.



For leavers (individuals who have been resident in the UK in one of the previous three tax years) the day counts are more stringent. Leavers also have an additional tie to consider, namely that they are not in the UK more than any other single country.  


 
There are a number of specific rules dealing with matters such as split year, where an individual can be treated as non-resident part-way through the tax year, and the treatment of income and capital gains earned in periods of temporary non-residence.



International transportation workers, including seafarers, also have their own rules. In their case, the tests relating to working full-time in the UK or abroad are dis-applied when looking at the automatic residence or non-residence position.  When considering day-count, a work journey that starts in the UK is considered a day of UK residence, whereas one that ends in the UK is not.
 


“The statutory residence test for the 2013/14 tax year should give greater certainty regarding an individual’s residence position,” concludes Gill Smith.  “The basic rules are quite straightforward, but there is considerable detail to catch the unwary.”

 

Maritime Reporter April 2015 Digital Edition
FREE Maritime Reporter Subscription
Latest Maritime News    rss feeds

People & Company News

Taiwan's Yang Ming Marine to Add Bigger Vessels to its Fleet

Yang Ming Marine Transport Corporation, Taiwnanese global shipping and logistics services company,  will take delivery of 14 large-sized ships over the next two years,

Hapag-Lloyd Adds North Europe-USEC Service

Hapag-Lloyd will open a new weekly service between North Europe and the US East Coast, the company said in its press release.     The new route – to be christened

Khamenei Says Iran Nuclear Weapons are a U.S. "Myth"

Iran's Supreme Leader Ayatollah Ali Khamenei told military commanders on Sunday the United States had created the "myth" of nuclear weapons to portray Iran as a threat,

Legal

Khamenei Says Iran Nuclear Weapons are a U.S. "Myth"

Iran's Supreme Leader Ayatollah Ali Khamenei told military commanders on Sunday the United States had created the "myth" of nuclear weapons to portray Iran as a threat,

PSV Launching Ceremony at Gondan

At high tide today at Gondan Shipyard in Figueras, the New PSV (TBN) for the Norwegian Ship-Owner, Simon Møkster Shipping, was launched. Different personalities

New CEO for Evergas

Evergas has appointed Steffen Jacobsen as CEO of the company as of 8 May 2015 Mr. Jacobsen joined Evergas 1 February 2015 as Vice President, Fleet after almost 35 years in Maersk.

Government Update

USN Names Littoral Combat Ship

Secretary of the Navy Ray Mabus announced today that the next Freedom-variant littoral combat ship (LCS) will be named USS St. Louis. The future USS St. Louis,

China Snubs G7 Declaration on Sea Row

Reacting to recent declaration of  the Group of Seven (G7) major nations' Foreign Ministers on maritime , China said “the situation of this region is generally stable,

Newport News Shipbuilding Hosts Sen. Inhofe

Huntington Ingalls Industries (HII) today hosted Sen. James M. Inhofe, R-Okla., for a tour of the company's Newport News Shipbuilding division.   The senator,

Consulting

Krill Systems Partners with Six Maritime

In recognition of the growing demand for Krill Vessel Fuel Management Systems (VFMMS) worldwide, including certain regions that are currently experiencing political instability, Krill Systems Inc.

RT to Frame Guidelines against Cyber Attacks

The Round Table of international shipping associations (RT) comprising BIMCO, ICS, Intercargo and INTERTANKO announced today that they are developing standards

Fugro Expertise for Wind Farm Developers in Netherlands

Fugro has been contracted by the Netherlands Enterprise Agency, part of the Ministry of Economic Affairs, to execute the geotechnical site investigation and

 
 
Maritime Careers / Shipboard Positions Maritime Contracts Maritime Standards Naval Architecture Pipelines Pod Propulsion Port Authority Ship Electronics Ship Simulators Winch
rss | archive | history | articles | privacy | contributors | top maritime news | about us | copyright | maritime magazines
maritime security news | shipbuilding news | maritime industry | shipping news | maritime reporting | workboats news | ship design | maritime business

Time taken: 0.1571 sec (6 req/sec)