Non residence as a fiscal nomad? - USERNAME: nomad14 - 16/12/2013

Tax Question:

This recent posting on another web site, presumably written by an accountant, concerns me. It suggests that, notwithstanding one being clearly non-resident under the SRT [I have zero ties for 2013/14], HMRC could treat a "fiscal nomad" as still being tax resident in the UK.

I plan to obtain permanent residence in Nevis in 2015 or 2016, but would be viewed as nomadic in the interim...

Please can you comment?

Answer:

There are aspects of the above that I'd agree with. Certainly there are aspects of the SRT that are still unclear (eg defining a UK "home", establishing whether there is UK accommodation, UK duties etc) and certainly it would be worth getting it looked at in detail.

It would also be the case that before April 2013 it would be more difficult to establish non residence in the circumstances outlined above (see our recent Practitioner Zone articles - Leaving the UK and making a distinct break - two recent Tribunal decisions. However, from April 2013 the SRT establishes some statutory rules that can determine when an individual is non resident - irrespective of foreign tax residence. For instance if an individual is in the UK for less than 46 or 16 days (depending on how long they have been UK resident for when they leave) they can be non resident for the given tax year. There is no mention in the legislation of needing to have established tax residence overseas to establish non residence under this provision.

Therefore in my view providing you meet the requirements of the SRT you would be non resident. I can see only one reference in the legislation to when foreign tax residence is taken into account for the SRT and this is only relevant in specific cases (see the Practitioner article Tax residence for a fiscal nomad - before and after 6 April 2013