The Automatic Residence Test

The Statutory Residence Test - rules from 6 April 2013

If you are fail the Automatic Overseas Test, then you need to consider the Automatic Residence Test (ART).

The ART has three conditions. Under the ART, if you meet any of the following three conditions you will treated as UK resident,:

  • You are present in the UK for 183 days or more in the tax year
  • You have only one home and that home is in the UK; or you have more than one home, and they are all in the UK. It counts are having a home in the UK if you have a home in the UK for at least 91 days, any part of which falls within the tax year under consideration. (Special rules apply if you also have a home abroad)
  • You work full-time in the UK (using a special definition of full-time work – see below)

Working full-time in the UK is defined as:

  • Working full-time in the UK means that you work in the UK for a working period of 365 days, with no significant breaks. Working full-time means an average of 35 hours a week. A significant break means one of 31 days or more where:
    • The absence from work is not a result of sickness, parenting leave or annual leave, and
    • There are no days where you work for 3 hours or more within the 31 day period

For the purpose of this test, you will be treated as working full-time in the UK if all, or part of, the working period falls within the tax year, and more than 75% of the total number of days for which you work, are worked in the UK (where a working day means working for 3 hours or more).

What if someone dies?

For the purposes of the ART, an individual is considered resident in the UK in the year of death, if:

  • They were resident in the UK for each of the previous three tax years (using the ART), and
  • Assuming they were not resident in the UK for the tax year, the preceding tax year would not have been a split year
  • When they died, they had a home in the UK

What happens next?

If you are considered resident by the ART, then you will be UK-resident for tax purposes and will usually be taxable in the UK on your worldwide income. There is a limited exception to this where the ‘split year treatment’ applies.

If you are not considered resident in the UK after the ART, there is still the Sufficient Ties Test to consider.

The rules are modified for those who work on-board a ship, aeroplane etc. which travels internationally.

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