Residence & Domicile

The concept of tax domicile is often confused with tax residence. Put simply, tax residence broadly relates to where someone lives and domicile broadly relates to where they come from. There are thousands of non-domiciles who are tax resident in the UK and this status confers important tax benefits.

Non-UK domiciles living in the UK can choose to pay tax only on their income and gains in the UK, leaving all their overseas income and gains outside the scope of UK tax unless they are brought into the UK.

This is called the remittance basis of taxation and is explained in more detail here.

However, following the Summer 2015 budget, notable changes are due to be introduced to the taxation of non-UK domiciled individuals from April 2017. These changes are explained in more detail here.

UK Tax residency can be a much more straightforward issue, as a Statutory Residence Test (SRT) was introduced for individuals for the 2013-14 tax year onwards. The SRT sets out clear rules for individuals to adhere to within the legislation. This can still, however, be complicated and expert advice should be sought if you are looking to move to or leave the UK.

Historic tax residency issues, prior to the introduction of the SRT, are far more complex but an area that our team have plenty of experience in.

For more information regarding residency for UK tax purposes, please click here or contact us to discuss either your residency or domicile status with a member of our team.