Residence & Domicile

Residence

 A person will be regarded as resident in the UK under the following circumstances:

  •  If they are present in the UK for 183 days or more in a tax year, they will be resident for that year for tax purposes
  •  If they come to live in the UK for two years or more they will be regarded as resident from the date of their arrival.
  •  If they habitually or regularly visit the UK and the visits are on average for 91 days or more in a tax year, usually worked out over a maximum of four consecutive tax years.

 Ordinarily resident

A person will be regarded as ordinarily resident in the UK:

  • If they are resident in the UK year after year on an on-going basis.
  •  If it is clear from the date they arrive in the UK that they intend to stay for at least 3 years.  They will be regarded as ordinarily resident from the date they arrive.

 Domicile

Domicile is a general law concept and refers to the country which a person regards as their permanent home.  Domicile status is usually acquired from a person’s father although it is possible to change it when the person becomes an adult.  Therefore, if both a person and their father were born in the UK, have lived in the UK for all or most of their lives and do not have strong connections outside the UK, then the person will be regarded as domiciled in the UK.  A person’s domicile status is usually only relevant if they have income or gains from outside the UK.

Individuals who are resident but not domiciled in the UK benefit from certain tax advantages such as having the remittance basis option of taxation for their foreign income and capital gains.  This benefit is not available to individuals who are domiciled in the UK for tax purposes.  Read the articles below for more information regarding the remittance basis of taxation and other tax advantages available for “non-doms”.

  • Non-doms: paying the Remittance Basis Charge

    If you pay the Remittance Basis Charge (RBC) using untaxed foreign income and/or gains from outside the UK, the payment itself might be regarded as a remittance and charged to UK tax. To avoid this happening, if you do pay the RBC from outside the the UK and paid direct to HMRC in a prescribed [...]

  • Non-doms: Remittance Basis

    A person who is resident in the UK is normally taxed on the “arising” basis. This means that they will pay UK tax on all their income as it arises and on their gains as they accrue, wherever that income and those gains are in the world. The remittance basis is an alternative to the “arising [...]

  • Non-doms: Remittances from a Mixed Fund

    A mixed fund is an overseas fund of money and/or property which consists of several types of income or gains and/or income or gains from several tax years. A typical example is a bank account into which different types of income, such as bank interest, dividends and earnings, or gains are paid. Another example of [...]

  • Non-doms: what is a “Remittance”?

    A remittance is any money or other property which is, or derives from, your offshore income and gains which are brought, either directly or indirectly, into the UK for your benefit. A remittance will also include any money or other property which derives from your offshore income and gains which are for the benefit of [...]

  • Non-UK Domiciliaries

    The new rules for persons who are resident but non-domiciled in the UK are as follows: - Annual tax charge of £30,000 to apply if individuals who are resident in the UK for 7 out of the previous 9 years wish to continue to use the remittance basis for overseas income and gains. - The charge will [...]

  • Tax residence: day counting

    Day counting   It is very important for those who have “left” the UK for tax reasons but who intend to visit regularly to  keep a count of the number of days they spend in the UK, particularly under the 4 year averaging rules.  For this purpose:  A day at the end (that is midnight) of which a person is present in the [...]