# UK "resident" not been in UK for a year



## backpacker (Oct 7, 2012)

Hi all,

My apologies if this has been answered somewhere, if it has I can't find it!

I'm due to file my UK 2011-12 tax return, and am trying to understand if there's any way I can be classed as a non-uk resident.

After lots of online reading and phonecalls to HMRC, it seems if I don't set foot in the UK for 1000 years, but never become "resident" in another country, then I still owe 20% of all my worldwide income to go towards UK MPs expenses. Surely this can't be right?

I've been out of the UK since July 2011, working freelance as a cameraman, only having spent 20 days since then in the UK (over various trips to visit my Mum, staying at various friend's houses, not with her at the family home - apparently this can affect status!).
I'm trying to find a way I can avoid UK residency status from last July, as I don't plan to return to the UK, and I don't want to pay tax earned on foreign soil.

I'm pretty sure (from talking to HMRC) that it doesn't affect it, but the companies paying me from July2011-2012 were UK companies, then after that they've been Canadian. From what I can gather, if I'm a non-UK resident, whoever is paying me is moot, BUT I think I need to be liable to pay taxes _somewhere_? - From the jumble of misinformation HMRC have given me over the phone, the advice which of course has no accountability!

I've only earned £30k, most of which is gone, so to lose the last £4000+ to a country I'm never going to live in again takes the ****. 
I appreciate if I'd have moved to another country permanently, this would be a lot more cut and dry. I still have my UK bank accounts open, I'm aware I should have severed every link with the UK last April, I just never thought they'd want me to be a "resident" so badly for such little pay.

I've tried to find an accountant that has knowledge of this, everyone that I've spoken to has said they don't know about it as it's such a unique case!

If anyone has any idea of how I can work around it, or knows anyone who might, I'd REALLY appreciate the help.
As if I needed another reason to never want to be a UK resident again! Nightmare!

Thanks for your time.


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## Bevdeforges (Nov 16, 2007)

Don't you have to file some sort of paperwork with the tax people in the UK to formally "declare" yourself non-resident in the UK? (Have heard about this many times, but since I'm not UK resident, have never really gotten into the details.)
Cheers,
Bev


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## backpacker (Oct 7, 2012)

Thanks Bev,

From what I can gather you don't need to do anything until you will in the taxes for that year - HMRC said if I'm applying for a split year I just list the date I left the UK, and from that point I'm not considered "resident" - though in my case I'm unsure if there's a way I can count as non-resident.


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## Elphaba (Jan 24, 2008)

You do need to be resident somewhere other than the UK to apply to be 'UK non-resident for tax purposes.'

The form referred to is HMRC form P85 a declaration of non-residency, but that is on the assumption that you are living or working somewhere. Liability to tax depends on residency and where income arises and work is carried out.

Where have you been living? Surely you have a 'permanent' address somewhere that you can use to register as UK non-resident?


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## backpacker (Oct 7, 2012)

Thanks for that. 
I've been living the dream and flying from port to port (15) over the year, since then I've been filming in Namibia, straight to a holiday in Jamaica, Canada and now SEAsia. My only postal address (as I don't spend more than a few weeks in each place) is my Mum's house back in the UK - who tells me if there's anything urgent in the mail (there never is).
This is basically my plan for the next 5 years at least.

It's a kick in the nuts if I never set foot in England again, but still have to pay a government tax that they're not really owed (in my view!). I'm aware I'll be renouncing my healthcare and benefits etc if I'm not "resident", and I'll lose all NHS privileges once I'm gone for 3 years or something - but I'll still have to pay tax? 
Surely there's a way I can claim NFA (No Fixed Abode), what do sailors or similar do?

I'm planning on getting a few working holiday visas, purely to show I'm living abroad, but it's really for the money earned from July 2011 to present that I'm worried about (I'm out of work at the moment).

I'm surprised no one's asked this before!


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## robnw (Jul 18, 2012)

Don't worry, there are known solutions, but there is no easy safe route and you'll either have to spend time understanding the issues before you start tax planning or you will need an advisor. Brits, unlike Americans, are generally outraged when they are expected to become conversant with accounting and tax and HMRC doesn't think it's their job to help, but that's what it takes. A course to teach you what you need to know would be about a week long.

> ..it seems if I don't set foot in the UK for 1000 years, but never become "resident" in another country, then I still owe 20% of all my worldwide income to go towards UK MPs expenses. Surely this can't be right?

Depends... on the type of job you had when leaving the UK, see below.

> I've been out of the UK since July 2011, working freelance as a cameraman, only having spent 20 days since then in the UK .. as I don't plan to return to the UK, and I don't want to pay tax earned on foreign soil.

Interestingly, HMRC are going to make a judgement about your residence in arrears, i.e. after several years have gone by. They are looking to see if you will have established a pattern of behaviour that says you have become resident elsewhere. [Exception which is not relevant to your case: when a UK person goes abroad on a contract of employment, the form to use is the P85 and _by concession_ HMRC treat one as non-resident from the day of departure.] 
see Residence or employment in the United Kingdom

> I'm pretty sure (from talking to HMRC) that it doesn't affect it, but the companies paying me from July2011-2012 were UK companies, then after that they've been Canadian. From what I can gather, if I'm a non-UK resident, whoever is paying me is moot, BUT I think I need to be liable to pay taxes somewhere? 

Another interesting point.. no actually there is a possible nirvana of no (or very low) tax due to any country which yachties and HNW persons resident in low tax countries in Europe can achieve. However, in your case, without planning in advance, let's say that the persons paying you probably did so gross and expect you to compile your own self employed accounts and submit them to the tax jurisdiction of your residence. (Most tax planners would consider if you would do better to route all your earnings through your own company based in Cyprus/Gib/Malta/Isle of Man, for less global tax: in your case, possibly not worthwhile at £30k p.a.)

> I've only earned £30k, most of which is gone, so to lose the last £4000+ to a country I'm never going to live in again takes the ****. I still have my UK bank accounts open, I'm aware I should have severed every link with the UK last April, I just never thought they'd want me to be a "resident" so badly for such little pay.

Well not having a bank account will make no difference - you're thinking about domicile aren't you? That's a different set of rules. What you've probably got in the UK tax year 2011/12 is four months of the year in the UK, and some days thereafter, and the rest outside, which is probably enough to establish non-residence in 2011/12 and therefore a possible tax reclaim for any PAYE tax paid in the first four months. After making sure of all relevant facts, enter a Tax Return stating your claim with the non-resident schedule attached, and without entering accounts for your self employment. As to which tax jurisdiction to report to with the s/e accounts - you won't know until you look at the actual dates in and out and then have a look at the tax treaties. It might be none. The option of entering your accounts in the UK for 11/12 might be a good idea if you can establish a loss on your s/e accounts after taking all your allowable expenses because you might end up getting more tax back. 
http://www.hmrc.gov.uk/cnr/hmrc6.pdf


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