statutory residence test

Statutory Residence Test (SRT): UK Tax Residence Explained

The Statutory Residence Test (SRT) is the set of rules used to determine whether an individual is resident or non-UK resident for UK tax purposes.

The SRT is particularly important for people who spend significant periods of time in the UK and overseas, move to or from the UK, work internationally, maintain homes in more than one country, or have family and other connections with the UK. Tax residence is not the same as ‘domicile’ status.

UK residence can have significant tax consequences. Your residence position may affect the extent to which the UK taxes your income and gains, including income and gains arising outside the UK. It can also be important when considering international tax planning, the Foreign Income and Gains regime, Capital Gains Tax, Inheritance Tax and the application of a double taxation agreement.

The SRT applies separately to each UK tax year, which runs from 6 April to the following 5 April. You can therefore be UK resident in one tax year and non-UK resident in another.

What is the Statutory Residence Test?

The Statutory Residence Test was introduced on 6 April 2013. It provides a statutory framework for determining an individual’s UK tax residence. Its purpose was and remains to reduce the ambiguity around assessing the various factors and day-counts that made things difficult previously.

Broadly, the SRT considers:

  • the number of days you spend in the UK;
  • whether you meet any of the automatic overseas tests;
  • whether you meet any of the automatic UK tests;
  • the extent of your work in the UK and overseas;
  • whether you have a home in the UK or overseas; and
  • your personal and other connections with the UK, known as UK ties.

The rules are deliberately structured so that an individual’s residence status is determined by applying a series of tests rather than simply asking whether the individual spends more than 183 days in the UK.

In particular, the 183-day rule is only one part of the SRT. Someone can become UK resident with substantially fewer than 183 UK days if the relevant automatic UK test or sufficient ties test is satisfied.

How does the Statutory Residence Test work?

The SRT broadly works through the following sequence:

  1. Consider whether you have spent 183 days or more in the UK.
  2. Consider the automatic overseas tests.
  3. If none of those tests determines your status, consider the automatic UK tests.
  4. If none of the automatic tests determines your status, consider the sufficient ties test.
  5. Where you are UK resident and have moved into or out of the UK during the year, consider whether split-year treatment applies.

HMRC’s guidance confirms that if an individual has spent 183 days or more in the UK in the relevant tax year, they are automatically UK resident and there is no need to consider the other tests. If that threshold is not reached, the remaining tests need to be considered in the appropriate order.

The Automatic Overseas Tests

The automatic overseas tests can establish that an individual is non-UK resident without needing to consider the sufficient ties test.

There are three principal automatic overseas tests for living individuals.

1. The 16-day test

If you were UK resident in at least one of the three tax years immediately before the tax year being considered, you will generally be non-UK resident if you spend fewer than 16 days in the UK during the relevant tax year.

This test is particularly important for someone who has previously been UK resident and is seeking to establish or maintain non-UK residence.

2. The 46-day test

If you were not UK resident in any of the previous three tax years, you may be non-UK resident if you spend fewer than 46 days in the UK during the relevant tax year.

The distinction between the 16-day and 46-day thresholds means that an individual’s residence history can be highly significant when applying the SRT.

3. Full-time work overseas

A further automatic overseas test can apply where an individual works full-time overseas.

Broadly, the individual must:

  • spend fewer than 91 days in the UK;
  • have fewer than 31 UK workdays on which they work for more than three hours; and
  • have no significant break from their overseas work.

The detailed definition of full-time overseas work is technical and involves calculations based on actual weekly working hours and the relevant reference period. It can apply to both employees and self-employed individuals, subject to the detailed rules.

Where one of the automatic overseas tests applies, the individual is generally non-UK resident for that tax year and there is no need to proceed through the remaining SRT tests.

The Automatic UK Tests

If the automatic overseas tests do not establish non-UK residence, the automatic UK tests need to be considered.

There are three principal automatic UK tests for living individuals.

1. Spending 183 days or more in the UK

This is the best-known Statutory Residence Tax rule, and one of the oldest factors used to determine someone’s tax residence status.

You will be UK resident for the tax year if you spend 183 days or more in the UK during that tax year.

Importantly, this test is conclusive. If you are present in the UK for 183 days or more, you are UK resident regardless of your other circumstances.

This is why keeping an accurate record of UK days is fundamental to any Statutory Residence Test analysis.

However, the converse is not true: spending fewer than 183 days in the UK does not automatically make you non-UK resident.

2. The UK home test

The second automatic UK test can apply where you have a home in the UK.

The rules are more complicated than simply owning or renting a UK property.

Broadly, the test can apply where:

  • you have a UK home;
  • there is a period of at least 91 consecutive days during which you have that UK home;
  • at least 30 of those days fall within the relevant tax year; and
  • you are present at the UK home for at least 30 days during the tax year,

subject to the detailed rules concerning overseas homes and periods of occupation.

For example, the existence of an overseas home does not necessarily prevent the UK home test from applying. The number of days spent in the overseas home is relevant.

The distinction between having a home, being present at a home and having an overseas home makes this test particularly important for internationally mobile individuals.

3. Full-time work in the UK

The third automatic UK test can apply where an individual works full-time in the UK over a qualifying 365-day period.

The detailed test considers the proportion of qualifying working days spent working in the UK and whether at least one relevant day falls within the tax year.

This test can therefore make an individual UK resident even where their total number of UK days is below 183.

What happens if none of the automatic tests applies?

This is where the Statutory Residence Test becomes more complex, and the sufficient ties test becomes particularly important.

If none of the automatic overseas tests and none of the automatic UK tests determines your residence status, the SRT looks at your connections with the UK.

These connections are called ties.

The fundamental principle is:

The more UK ties you have, the fewer days you may be able to spend in the UK before becoming a UK tax resident.

The number of UK ties required depends upon:

  • the number of days you spend in the UK; and
  • whether you were UK resident in any of the previous three tax years.

The Sufficient Ties Test

There are five principal UK ties:

  1. Family tie
  2. Accommodation tie
  3. Work tie
  4. 90-day tie
  5. Country tie

The country tie is relevant where the individual was UK resident in one or more of the three previous tax years.

Family tie

A family tie can arise where certain close family members are UK resident.

For example, the rules can apply where an individual’s spouse, civil partner or relevant partner is UK resident, or where the individual has a qualifying child under 18 who is UK resident, subject to detailed conditions.

The family tie is therefore potentially significant for someone who spends relatively limited time in the UK but whose immediate family remains here.

Importantly, having a family tie does not by itself make someone UK resident. It is one factor which is combined with the individual’s UK days and other ties.

Accommodation tie

An accommodation tie can arise where an individual has a place to live in the UK which is available to them for a continuous period of at least 91 days and they spend at least one night there during the tax year.

There are special rules where the accommodation belongs to a close relative, in which case a higher number of nights may be relevant.

This means that a person does not necessarily need to own a UK property to have an accommodation tie.

A family property, rented accommodation, holiday property or other available accommodation can potentially be relevant depending on the circumstances.

Work tie

A work tie can arise where the individual works in the UK for at least 40 days during the tax year, with the detailed legislation determining what constitutes a relevant UK workday.

The work tie is particularly important for people who travel regularly to the UK for business purposes.

90-day tie

A 90-day tie can arise where the individual spent more than 90 days in the UK in either or both of the previous two tax years.

This can make the individual’s historic UK presence relevant to their residence position even though they are assessing a different tax year.

Country tie

The country tie is relevant to individuals who were UK resident in one or more of the three previous tax years.

Broadly, a country tie can arise where the UK is the country in which the individual was present at midnight on the greatest number of days during the tax year.

Where the greatest number is shared between countries and the UK is one of those countries, the country tie can also arise.

How many UK ties are enough to make you UK tax resident?

The answer depends upon your previous residence history.

If you were UK tax resident in one or more of the previous three tax years – “leaver”

UK days in the tax year UK ties required
16–45 At least 4
46–90 At least 3
91–120 At least 2
More than 120 At least 1

If you were not UK tax resident in any of the previous three tax years – “arriver”

UK days in the tax year UK ties required
46–90 All 4 applicable ties
91–120 At least 3
More than 120 At least 2

These thresholds are the reason that the statement “I spend fewer than 183 days in the UK, so I am not UK resident” can be dangerously misleading.

Someone with relatively few UK days can nevertheless become UK tax resident if they have sufficient UK connections.

Why the Statutory Residence Test can be difficult

The Statutory Residence Test may appear relatively straightforward when viewed as a series of day-count thresholds.

In practice, however, residence analysis can become highly technical.

Questions can arise over:

  • exactly how many days an individual was present in the UK;
  • whether a particular day counts as a UK day;
  • whether the individual has a UK home;
  • whether accommodation constitutes an accommodation tie;
  • whether an individual has worked in the UK;
  • whether work is sufficiently substantial to constitute a workday;
  • whether family members create a family tie;
  • the individual’s UK residence history;
  • whether the individual has a country tie;
  • whether overseas work is genuinely full-time;
  • whether exceptional circumstances affect the day count;
  • whether split-year treatment applies;
  • and how the Statutory Residence Tax interacts with a relevant double taxation agreement.

For internationally mobile individuals, residence should therefore normally be analysed as a complete factual picture rather than by looking at the number of UK days in isolation.

Moving to or Leaving the UK: Split-Year Treatment

The Statutory Residence Test normally determines residence for the whole tax year.

However, where an individual moves into or out of the UK during a tax year, split-year treatment may apply if specific conditions are satisfied.

Where split-year treatment applies, the tax year is divided into:

  • a UK part, during which the individual is treated as UK resident; and
  • an overseas part, during which the individual is treated as non-UK resident for most purposes.

There are eight statutory sets of circumstances in which split-year treatment may potentially apply, including circumstances involving leaving the UK, starting full-time work overseas, becoming resident in the UK and establishing a UK home.

Split-year treatment is not simply an election that an individual can make because they moved during the year. The relevant statutory conditions must be satisfied.

Why UK Residence Matters

Your UK residence status can affect the UK taxation of your income and gains, including income and gains arising outside the UK.

It can therefore be particularly important for individuals who:

  • are moving to the UK;
  • are planning to leave the UK;
  • regularly travel between the UK and another country;
  • have homes in more than one country;
  • operate businesses internationally;
  • have overseas investments or bank accounts;
  • have foreign income or gains;
  • have family members living in different countries;
  • are considering the Foreign Income and Gains regime;
  • are concerned about UK Inheritance Tax; or
  • are relying on a double taxation agreement.

Residence is also only one part of the wider international tax analysis. An individual’s residence position may need to be considered alongside domicile, the Foreign Income and Gains regime, Inheritance Tax rules and the provisions of any applicable tax treaty.

How Pure Tax Can Help With the Statutory Residence Test

Determining UK residence is often a matter of a detailed analysis of the facts rather than simply counting days.

Pure Tax provides specialist UK residence and domicile tax advice to individuals with complex UK and international circumstances.

We can help you establish your UK residence position by reviewing and comprehensively documenting the Statutory Residence Test results:

  • your UK and overseas travel and day counts;
  • your residence history;
  • your UK and overseas homes;
  • your employment, business and working arrangements;
  • your family circumstances;
  • your UK accommodation;
  • your previous UK days;
  • your UK ties;
  • your overseas working arrangements;
  • potential split-year treatment; and
  • the wider UK tax consequences of becoming or ceasing to be UK resident.

We can also consider the interaction between the Statutory Residence Tax and wider international tax issues, including the Foreign Income and Gains regime, overseas income and gains, Inheritance Tax and relevant UK tax treaties.

For individuals planning a move to or from the UK, obtaining advice before the move takes place can be particularly valuable. Residence planning can involve decisions about timing, travel, accommodation, employment, investments and the location of assets and activities.

Specialist Residence and Domicile Tax Advice

Pure Tax Investigations advises private clients and internationally mobile individuals on UK residence, domicile and related tax issues.

Our advice can include:

  • Statutory Residence Test analysis;
  • UK arrival planning;
  • UK departure planning;
  • split-year treatment;
  • sufficient ties analysis;
  • UK and overseas home analysis;
  • international working arrangements;
  • Foreign Income and Gains regime advice;
  • overseas income and gains;
  • UK Inheritance Tax considerations; and
  • UK treaty and international tax issues.

If you are uncertain whether you are UK resident, are planning to move to or leave the UK, or are concerned that your UK connections could make you UK resident, we can undertake a detailed Statutory Residence Tax analysis based on your individual circumstances.

Statutory Residence Test FAQs

Is the 183-day rule the only UK tax residence test?

No. The 183-day rule is only one of the automatic UK tests. A person can become UK resident with fewer than 183 UK days under the other automatic UK tests or the sufficient ties test.

How many days can I spend in the UK without becoming tax resident?

There is no universal number of days that guarantees non-UK residence.

The answer depends upon your previous UK residence history, your UK ties, your accommodation, work, family circumstances and other facts.

What are the sufficient ties?

The principal UK ties are the family tie, accommodation tie, work tie, 90-day tie and, where applicable, country tie.

Does owning a UK property make me UK tax resident?

Not automatically. Ownership of a UK property is not, by itself, sufficient to establish UK residence. However, a UK home can be relevant to the automatic UK home test and an available UK property can potentially create an accommodation tie.

Can I be UK tax resident if I work overseas?

Yes. Working overseas does not automatically make an individual non-UK resident. The automatic overseas working test has detailed conditions concerning UK days, UK workdays and overseas working.

Can I be tax resident in the UK and another country?

It is possible to be resident under the domestic rules of more than one country. Where that occurs, an applicable double taxation agreement may contain treaty residence rules that determine residence for treaty purposes.

Can I split the UK tax year when I move?

Potentially. Split-year treatment can apply in specific circumstances when an individual moves into or out of the UK, but the statutory conditions must be satisfied.

Can Pure Tax determine my UK tax residence position?

Yes. Pure Tax advisers can undertake a detailed Statutory Residence Test analysis, including UK day counts, facts relating to the automatic tests, weighing up the sufficient ties, location and availability of homes, work arrangements, family connections and potential split-year treatment.

UK tax residence should be assessed on the complete facts rather than on the number of days spent in the UK alone.