AccountingWEB exclusive: Inside the Gaines-Cooper case

What we want is a test for residence which is objective, probably based on days spent. We already have a starting-point formula, 183 or 91 days on average now with a midnight criterion. Other countries e.g USA and Ireland have a weighted average. HMRC hate objective tests because these take away their discretion. They cannot be trusted to exercise that fairly. Despite the clear statutory intent of removing the UK available accommodation test in 1993 HMRC has clung onto it as an element of leaving the UK and of ordinary residence. I would not want my residence status to be examined by reference to metaphysical criteria or a soul-searching exercise conducted by the prelates of the zealot  Cardinal Hartnett in order to determine whether or not I am in some fiscal state of grace. That is while they are not granting Indulgences to total crooks under offshore disclosure opportunities. And domicile should go objective in  the same way--no more foreign grave plots and intending at 90 to return home only if your 20 year old wife pre-deceases you. I want to be taxed by law not untaxed by concession or the administrative whim of an organisation that has the collective conscience of a well-trained hippopotamus.

I think what we need first of all is to get domicile completely out of the system for income tax and CGT !  And adopt a calendar year for tax to prevent us all going mad when trying to fit round other countries' rules.

After that, a definitive test has its advantages, but it won't solve all the problems. I have a client who has carefully controlled the days he spends in the UK while genuinely working abroad, but who has overrun because his mother became terminally ill. Under the present rules that leaves him confused, but a definitive test would presumably simply give him out - would he be better off ?

At one time, of course, maintaining an available property was a knockout. When it was removed from the legislation it was clear (in my memory anyway) that it was still a factor, just no longer conclusive.

I think too that it is accepted that you must be resident somewhere for tax purposes - there is a case which says that floating in international waters for twelve months is not enough. So you keep the original residence until you becaome resident somewhere else Imagine the case of someone who spends twelve months in a space station in orbit : every day he inhabits the space of 57 different countries, all of whom claim him as resident under a 183 day test.

What we need is some certainty !

I am now completely confused. If you have income or assets in the UK are you still resident.

Leaving your wife here does not make sense either as she would have been treated as single person (prior to 1991) if husband was abroad.( a divorce was not neccesary) And what about people who have a contract of employment abroad ? are they now resident here too ? Even when HMRC have agreed they are not.

How do you sever links with your children ?

Pehaps you need to be banished by the Queen !

More CPD !

Certainty??  That won't go down well with Hector... With apologies to Douglas Adams:

"We don't demand solid facts! What we demand is a total absence of solid facts. We demand rigidly defined areas of doubt and uncertainty!"