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 November 2013 Digital Edition
FREE Maritime Reporter Subscription
Latest Maritime News    rss feeds

People & Company News

U.S. Drillers Cut Rigs to Lowest since August

Energy companies have reduced the number of rigs drilling for oil in the United States to the lowest since August, shifting more rigs in favor of natural gas as crude prices dive,

Equinox Class Scrubber Systems Receive Certification

Algoma Central Corporation (“Algoma”), the largest Canadian shipowner and operator of domestic Great Lakes vessels announces that it has received all requisite

MARAD Tests Alternative Power for Ships

The Maritime Administration (MARAD) is testing state-of-the-art, environmentally efficient technology onboard the Training Ship (TS) Kennedy.   The National Defense

Legal

Italy Ending Med Sea Rescues

Rights groups warn of risk of more deaths; EU mission Triton will have more limited scope. Italy said on Friday it would close a sea rescue mission that has saved the lives of more than 100,

St. Lawrence Seaway Workers Extend Strike Deadline

The union that represents workers on the St. Lawrence Seaway, the waterway that links the Great Lakes and the Atlantic Ocean, has extended a strike deadline to Monday at 5 p.

Total CEO: EU Must Fight US Crude Export Law

First major public appearance of new Total head; he challenges European politicians to fight US ban. The new head of French energy major Total challenged Europe to fight Washington over the U.

Government Update

Italy Ending Med Sea Rescues

Rights groups warn of risk of more deaths; EU mission Triton will have more limited scope. Italy said on Friday it would close a sea rescue mission that has saved the lives of more than 100,

MARAD Tests Alternative Power for Ships

The Maritime Administration (MARAD) is testing state-of-the-art, environmentally efficient technology onboard the Training Ship (TS) Kennedy.   The National Defense

St. Lawrence Seaway Workers Extend Strike Deadline

The union that represents workers on the St. Lawrence Seaway, the waterway that links the Great Lakes and the Atlantic Ocean, has extended a strike deadline to Monday at 5 p.

Consulting

SMC to Provide Marine Coordination for Siemens

Specialist Marine Consultants Ltd (SMC) have been working with Siemens, providing offshore marine coordination for a fifth Siemens Wind Power construction project.

Good Performance by Dun & Bradstreet in 3Q 2014

Dun & Bradstreet, the world's leading source of commercial information and insight on businesses, today reported results for the third quarter ended September 30, 2014.

Schlumberger Introduces New Well Integrity Service

Schlumberger announced today the release of Invizion Evaluation* well integrity service, which helps operators evaluate zonal isolation by using integrated drilling, cementing and well logging data.

 
 
Maritime Contracts Maritime Standards Offshore Oil Pipelines Salvage Ship Electronics Ship Repair Ship Simulators Shipbuilding / Vessel Construction Sonar
rss | archive | history | articles | privacy | terms and conditions | 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: 0.1494 sec (7 req/sec)