Non-Resident For Tax In Any Country - actual taxation

Hello, I am requesting assistance for a possible scenario occurring where a UK citizen who is already non-resident for UK tax/non-domicile may take a (part-time) consultancy role which is not specific to any individual country location. It is feasible for that person to become "non-resident for tax purposes" in all countries (including UK) for the period 2024/2025 (for various reasons). If a UK citizen does not qualify for tax residency in any country (including UK) then, under these circumstances would it be generally accepted/recognized by UK (and possibly other countries) that the person would probably fall within the UK tax jurisdiction mainly on account of the UK citizenship? If the above is consider the general understanding, that the person would be subjective to UK taxation, then I have a few follow-up questions: 1) Would the country location of the bank account where the remittance payment is made or the country where the Client is based have any influence on this generally accepted decision? 2) Would the remittance payments also be subjected to NI? If yes, would such payments contribute towards a "qualifying year" for state pension (as no employer's payments are made)? 3) Would it be possible for that person to contribute to UK private pension/SIPP up to the annual allowed limit if applicable (understood currently to be £60,000), in a similar way to either salary sacrifice payment or benefitting from the tax relief on the contributions? 4) Would it be possible for that person to contribute to UK ISA up to the annual allowed limit (understood currently to be £20,000 for shares ISA)? 5) Would it affect that person's tax/domicile status in future tax years (having meaning that he/she was resident in the UK for tax for 2024/25 - even though officially they would not be according to HMRC guidelines) or would they still be consider for that year as being non-resident for tax? Thank you

Hi,

Residence in the UK is primarily based on the number of days you are physically in the UK. You would need to undertake the statutory residence tests. after reading the guidance at RDR3, to determine your residence position.  

RDR3 Statutory Residence Test

If you are not tax resident in the UK for the whole tax year, then you would only declare in the UK, any UK income or capital gains that arise. For example, bank or buiding society interest, UK dividends and UK capital gains.  Any income or capital gains, arising outside of the UK, will not be taxable in the UK. They may be taxable in other countries.  

In order to use the remittance basis, you are required to be resident in the UK for tax purposes. The remittance basis does not include National Insurance. That is a separate matter to Income Tax.

You can pay up to 100% of your earnings in a tax year, up to the maximum of your employment income or £60000, whichever is lower in the tax year you leave the UK and £3600 each year for the next 5 years, provided there is an existing UK pension scheme.

You cannot contribute to an ISA scheme in any tax years that you are not UK resident. You can in the tax years you leave or arrive in the UK.  

We cannot comment of future tax years, as guidance may change.

Thank you.

Hello, thanks you reply. Maybe I address my question to this current tax year. A uk citizen shall not pass the threshold required to become tax resident in any of the countries they have stayed in throughout the tax year including the UK and therefore they appear as "non-resident for tax" in all countries based on each country's residency test (including the UK and including the UK's RDR3 Statutory Residency Test). Is there a general accepted agreement that such a person would generally fall within the UK tax jurisdiction mainly on account of the UK citizenship or is that person not liable for UK tax on overseas income? Note - the only alternative I understand (if the UK does not claim to be the jurisdiction for taxation) is that person does not pay tax anywhere - which does not appear correct but maybe unavoidable - and that is why I ask the above question.

Hi james h

Please refer to further guidance at Dual residents 2024 (HS302)

Thank you

I am retired drawing my state pension and a small teachers' pension. I have a little more than the tax-free allowance so pay some income tax. I have been technically non-resident now for 2 tax years though have not yet completed a P85. I am travelling so not resident in any other country. If I complete the P85 can I reclaim the income tax I have paid?

Hi
Yes.