Determining residence status (pre 2013/14)

By Tolley
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The following Personal Tax guidance note by Tolley provides comprehensive and up to date tax information covering:

  • Determining residence status (pre 2013/14)
  • Introduction
  • When is someone non-UK resident for years up to and including 2012/13?
  • When is someone resident in the UK in the years up to and including 2012/13?
  • Special cases

Residence is an important tax concept as it determines whether an individual is liable to UK income tax, capital gains tax and inheritance tax. Residence must be decided on a year-by-year basis.

The statutory residence test applies from 6 April 2013. The test applies for income tax, capital gains tax and inheritance tax, but not for national insurance purposes. All existing law, case law and guidance is superseded for tax years following the introduction of the test.

This guidance note considers the rules in place for determining residence up to and including the 2012/13 tax year. For details of the statutory residence test, see the Determining residence status (2013/14 onwards) guidance note.

This guidance note refers to ordinary residence as a key factor in understanding an individual’s liability to UK tax. This is only the case up to 5 April 2013 as this concept was removed from the statute from this date for tax purposes (subject to transitional provisions). For more on the transitional provisions, see the Ordinary residence ― transitional rules (2013/14 to 2015/16) guidance note.

Introduction

In relation to the 2012/13 tax year and prior tax years, residence is one of three key factors you should consider when deciding whether, or to what extent, an individual is liable to tax in the UK. The others are ordinary residence and domicile.

As noted above, residence refers to the individual’s tax status on a year by year basis, ordinary residence looks at the position over the longer-term, and domicile is the place which a person regards as his true home. See the Ordinary residence ― years to 5 April 2013 and Domicile guidance notes for more detail.

Of course it is possible for a person to be resident, ordinarily resident and domiciled in the same place, and indeed this is true for most people. The problems come

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