Non Dom Non Res UK |Tax

Non Dom Non Res UK |Tax

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A client of ours who is not domiciled in the UK but has been resident here for 3 years, working for a UK company. In March 2014 their employer sent them to work in Saudi Arabia for 12 months. During the 2014/15 tax year during this time they spent only 55 days in the UK of which 27 were UK work days. They have had PAYE operated on their pay through the year.

I believe they are not resident in the UK for 2014/15 and should only have been taxed on their UK work days, they do meet the 35 hours test under the SRT test 3.

Am i mistaken?

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By User deleted
11th Jun 2015 13:51

Well, if the client is not

Well, if the client is not tax resident (which is subject to SRT and will be based on facts) during the tax year, his tax liability should be limited to earnings in respect of duties performed in the UK (s.27 ITEPA/03). So you're NOT mistaken.

 

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By Steve Kesby
11th Jun 2015 13:55

I agree...

... to a large extent. But the concept of "work days" is limited to the SRT; it is not the same test as in ITEPA 2003, s 27 and s 39.

If the individual is not UK resident (and they do appear not to be) then they are only liable to UK tax on their earnings from duties performed in the UK (s 27). Any duties actually performed in the UK are also deemed to be performed outside the UK if they are merely incidental to the performance of duties outside the UK (s 39).

See EIM40101 onwards and THIS from Taxation.

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Replying to mbee1:
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By User deleted
11th Jun 2015 14:05

@Steve

But we don't know whether UK duties are 'merely' incidental!

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By Steve Kesby
11th Jun 2015 14:38

I never said they were

I said:

"Any duties actually performed in the UK are also deemed to be performed outside the UK if they are merely incidental to the performance of duties outside the UK (s 39)."

We don't know that they are not, so it seems worth mentioning.

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By rigsby
11th Jun 2015 15:09

Thank you

The UK duties were not incidental to the duties outside the UK, those days related to a different project.

The cleints non-resident status  is as I thought which is the main thing.

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