How To Start A Business With TOP QUALITY RESIDENCES

The government is proposing new rules that come to effect from 6 April 2013 that will put UK residence for tax purposes on a statutory footing, rather than relying on HMRC guidelines and case law. In principle this can be a sensible move and will provide certainty for anybody unsure at present whether they qualify as being non-resident in the united kingdom for tax purposes. However the rules are complex and have attracted some criticism that is why.

Under the current rules you’re resident in the UK in the event that you spend 183 days or even more in the UK and you could be resident if you spend more than 3 months on average. Beneath the new rules you will see no more four-year average and if you spend more than 90 days in the UK in any tax year you will continually be considered to be resident. Ki Residences Singapore As before, you need to be away from the UK for a complete tax year so as to qualify as non-resident and a day counts as being a day on the UK should you be here at midnight on that day.

However, the new law is generally designed to leave a lot of people in the same position as previously so you are unlikely to find your position suddenly altered. It is important though that you understand the new test of residence and non-residence. There are three parts of the test that have to be considered to be able. In other words, for anyone who is definitely non-resident on the basis of Part A, then you need not consider parts B and C.

So, we think most of our clients ought to be still covered by the provision partly A you are non-resident assuming you have left the UK to carry out full-time work abroad and so are present in the UK for fewer than 91 days in the tax year and no a lot more than 20 days are spent employed in the united kingdom in the tax year. Here though are the three parts of the test.

Part A: You are definitely non-resident if:

You were not resident in the united kingdom for the prior 3 tax years and within the UK for under 46 days in the current tax year; or You’re resident in the UK in a single or more of the previous 3 tax years but present in the UK for fewer than 16 days in today’s tax year; or You have gone the UK to handle full-time work abroad and provided you were present in the united kingdom for less than 91 days in the tax year no a lot more than 20 days are spent employed in the united kingdom in the tax year. Training covered by your employer and taken in the UK will undoubtedly be considered work and this will be extracted from your 20 day working allowance.

Part B: You’re definitely resident if:

You are present in the united kingdom for 183 days or more in a tax year; or You have only one home and that home is in the united kingdom or have significantly more homes and all of these are in the UK; or You perform full-time work in the UK.

Part C: If your situation is not described in Parts A and B then you need to compare the amount of days spent in the UK against a small number of clearly defined connection factors. These connection factors are the following:

Family- your spouse or civil partner or common law equivalent (provided you aren’t separated from them) or minor children are resident in the UK. Accommodation – you have accessible accommodation in the UK and makes use of it through the tax year (subject to exclusions for some types of accommodation). Substantive work in the united kingdom – you do substantive work in the united kingdom i.e. a lot more than forty days in the tax year but usually do not work full-time in the united kingdom. UK presence in previous years – you spent a lot more than 90 days in the united kingdom in either of the prior two tax years and you spend more days in the united kingdom in the tax year than in virtually any other single country.

These connection factors are then combined with day counting to determine whether you’re resident or non-resident. There are two categories, arrivers and leavers.

If you weren’t resident in any of the previous three tax years – ‘Arrivers’:

Less than 46 days in UK: Always non-resident. 46 – 3 months: Resident if 4 or more connection factors. 91 – 120 days: Resident if 3 or more connection factors. 121 – 182 days: Resident if 2 or even more connection factors. 183 days or even more: Always resident.

If you were resident in a single or more of the three tax years immediately before the tax year in mind – ‘Leavers’:

Less than 16 days in UK: Always non-resident. 16 – 45 days: Resident if 4 or even more connection factors. 46 – 90 days: Resident if 3 or more connection factors. 91 – 120 days: Resident if 2 or more connection factors. 121 – 182 days: Resident if you can find 1 or more connection factors. 183 days or even more: Always resident

Once the Finance Bill is produced there could be some changes to the legislation and more detail may emerge, but there has been considerable consultation in fact it is sensible to prepare for the brand new rules now. If that is relevant to your situation you should take professional advice to be sure you do not fall foul of the new legislation.

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