Residency for Tax purposes

[aurora]

hello hope someone can help.

we have a joint Australian bank acccount and have received letters asking us to clarify our residency.

For the 2018/19 tax year we will have lived in the UK for 98 days before moving to australia.

Am I correct in saying that we are therefore both non residents of the uk even though my husband still has an income from the uk?

(he does have an accountant to deal with the dual country income).

[Marisawright]

Ask the accountant, but you generally need to reside in the UK for more than half the tax year to be considered residents.

[aurora]

I think now we may both be residents of the uk? From gov.uk site:

You’re automatically resident if either:

• you spent 183 or more days in the UK in the tax year
• your only home was in the UK - you must have owned, rented or lived in it for at least 91 days in total - and you spent at least 30 days there in the tax year

You’re automatically non-resident if either:

• you spent fewer than 16 days in the UK (or 46 days if you haven’t been classed as UK resident for the 3 previous tax years)
• you work abroad full-time (averaging at least 35 hours a week) and spent fewer than 91 days in the UK, of which no more than 30 were spent working.

What do we answer to the "only home" part? we had our home in uk but a rented home in Australia in same tax year?

 

[Marisawright]

18 minutes ago, aurora said:

I think now we may both be residents of the uk? From gov.uk site:

You’re automatically resident if either:

• you spent 183 or more days in the UK in the tax year
• your only home was in the UK - you must have owned, rented or lived in it for at least 91 days in total - and you spent at least 30 days there in the tax year

You’re automatically non-resident if either:

• you spent fewer than 16 days in the UK (or 46 days if you haven’t been classed as UK resident for the 3 previous tax years)
• you work abroad full-time (averaging at least 35 hours a week) and spent fewer than 91 days in the UK, of which no more than 30 were spent working.

What do we answer to the "only home" part? we had our home in uk but a rented home in Australia in same tax year?

 

If you lived in a home in Australia, then your UK house clearly wasn’t your only home.

[aurora]

ok in that case we answer 'no' to every scenario. will ask professionals on monday.

[Alan Collett]

Do a Google search for HMRC booklet RDR3 which discusses the Statutory Residency Test in the UK.

There is more to the question of UK residency than has been discussed above.

Plus, you may now be tax resident in Australia, with split year treatment applying in the UK since you departed.

Take professional advice in respect of the UK and Australia if uncertain and the issue is of significance.

Best regards.

Edited January 5, 2019 by Alan Collett

[Alan Collett]

7 hours ago, Marisawright said:

Ask the accountant, but you generally need to reside in the UK for more than half the tax year to be considered residents.

Not so - there's more to UK tax residency than this.

For example, consider the sufficient ties tests.

Best regards.

[rammygirl]

In the meantime tell your bank when you arrived in Australia and took up residency. They will stop any withholding tax, you should have been paying this on any interest whilst resident in the UK. Any overpaid tax can be reclaimed on you future ATO return though  

 

[aurora]

we had already given the bank all this info, plus our UK NI numbers, australian TFNs. Alans 'split year' scenario seems the best fit but the form the bank has sent doesn't take this into account.

Thank you for your replies, will see what our accountant says.

 

[Ken]

20 hours ago, aurora said:

we had already given the bank all this info, plus our UK NI numbers, australian TFNs. Alans 'split year' scenario seems the best fit but the form the bank has sent doesn't take this into account.

Thank you for your replies, will see what our accountant says.

 

I haven't seen the forms you've received, but the ones I occasionally see from my own bank only ask for my residency status right now (meaning on the date I sign and date it). They don't ask what it was on dates in the past (although they may ask the date I became an Australian resident). This means if (like me) you had split year scenario in the year you arrived and have been an Australian resident ever since the only answer to give is that you are an Australian resident (and the date you became one if they ask for that). But of course the questions your bank is asking may be different from those my bank asks.