Temporary Non-Resident rules when receiving dividends from a foreign company

Dear Sirs, First some background to provide context to my questions. I have spoken to tax advisors, but the following seems a bit of a grey area: I left the UK to set up a business in the EU earlier this year, which is where I now live. Under the automatic residency rules, I am still tax resident in the UK and won't trigger non-tax resident rules until next UK tax year. That is preferable since I have a UK business that I am currently liquidating to claim my Entrepreneurs Relief/BADR. It will be my only UK income this tax year. Once that tax sum is paid, I will be informing HMRC that I am no longer tax resident. I am not paying myself any income from my EU business for UK tax year 23/24. This keeps my tax affairs cleaner and more simple. My questions: I will be paying myself a dividend (but not a salary) from my EU business on or after 6 April 2024, where I will no longer be UK tax resident - and won't be for at least the entirety of that tax year. 1. Were I to return to the UK under the 'temporary non-resident' rules and so within 5 years of becoming UK non-tax resident, would I be liable for income tax? 2. If I pay that dividend into my UK bank account, would it be liable for tax where I am non-tax resident? 3. Is it correct that non-tax residents who receive foreign income do not need to declare it/file a Self Assessment tax return? Many thanks for your help.

Hi,

If you return to the UK, you would need to review the statutory residency tests here:

RDR3 Statutory Residence Test

If you meet the criteria to be tax resident in the UK, then you would be required to submit a Self Assessment tax return, to declare your overseas income and gains. Up to 100% foreign tax credit could be claimed on the onverseas tax paid.

If you are not resident in the UK, then your overseas dividend is not taxable in the UK, however any interest that the dividends generate would be taxable in the UK, as disregarded income.

If you are not resident in the UK and you do not have any UK income, then a tax return is not required, as none of your overseas income is taxable in the UK.

If you have UK property which you rent out or dispose of, then a tax return will be required.

Thank you.