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Split year treatment when non-resident under SRT?

Split year treatment when non-resident under SRT?

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Hi everybody

I was a UK resident for the last 5 years. I moved out on 14th May 2018. I've worked for 47 days in the UK in total during the last tax year (it's because I had a few business trips to the UK after I moved out). My SRT for 2018-2019 result was non-resident in the UK.

My financial advisor suggests that SYT will apply from the 14th of May, but can SYT apply if my SRT result was non-resident?

My understanding is that SYT doesn't apply if my SRT result was non-resident, however even as a non-resident I still have to pay tax for salary income from the days I worked in the UK but the dividends can be treated as disregarded income. Is that correct?

Many thanks

Greg

Replies (16)

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By carnmores
22nd May 2019 12:11

My understanding is if you have left UK, subject to the usual provisos that you seem to have covered, is that you are now non resident and as such allowed certain days in the UK so SYT treatment is not relevant for 2018 19 provided you stay within the guidelines. I agree that any salary from UK employment is taxable in UK and the country you are now residing in but will likely be subject to double tax relief. But this does not necessarily mean that dividends are not taxable in the UK , it will depend on where they come from: for instance if they are from a private UK company that you have a substantial share in then dividends paid out of profits earned before your departure should be declared on tax return and taxed in UK. I am sure that if my interpretation is incorrect it will be challenged hereon.

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By Tax Dragon
22nd May 2019 12:27

I'm surprised the SRT resulted in you being non-resident. You might want to check the workings.

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Replying to Tax Dragon:
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By Presto 10
22nd May 2019 13:21

I didn't pass any of the 3 automatic tests, but it seems that I'm not resident one the insufficient ties basis

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Replying to Presto 10:
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By Tax Dragon
22nd May 2019 13:52

Did you skip straight over the other two automatic tests? Where were you staying before you left?

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Replying to Tax Dragon:
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By Presto 10
22nd May 2019 14:10

The advisor I paid went through all the automatic tests.

Before I left I was renting a property. My tenancy agreement expired on 14th May 2018 (the day I left).

After that, I had some visits to the UK but I rented out a hotel.

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Replying to Presto 10:
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By Tax Dragon
22nd May 2019 14:46

But it's clear that you don't trust your paid advisor's analysis. That's why you're asking in here.

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Replying to Tax Dragon:
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By carnmores
22nd May 2019 14:34

Belt and braces :-)

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Replying to Tax Dragon:
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By carnmores
22nd May 2019 14:35

Belt and braces :-)

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Replying to Tax Dragon:
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By Presto 10
22nd May 2019 15:12

I do have trust to SRT report they've provided. I did my own research (for whatever it's worth) and asked a few questions online and it overlapped with their result.

Therefore the original question was not about the residency but about when SYT applies. I have feeling that my Self Assessment was prepared by not the same person who made my SRT report. My lack of trust is about Self Assessment part and when to apply SYT. Hence I'm asking here.

But you suggested that they're wrong about my residency in the first place... I'm open to any second opinion. I answered yo your specific questions, but I'm still not sure based on what you believe I'm a resident?

Many thanks!

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Replying to Presto 10:
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By Tax Dragon
22nd May 2019 15:33

It's not definite (how would I know? I know next to nowt about you), but I think it not unlikely that you pass the 2nd automatic UK test. (In fact, learning from Vile on another thread, I'd go so far as to say I think it likely that you pass that test.)

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Replying to Tax Dragon:
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By Vile Nortin Naipaan
22nd May 2019 15:43

I think one should avoid using the term "pass" or "fail" in the context of the SRT. Pass indicates success, which if one's desire is to be treated as non-resident might mislead them.

I'd be inclined to use a term like "fall foul of" the 2nd automatic UK test. I think it's highly likely that the OP falls foul of the 2nd automatic non-overseas test. Of course they may have been told that they're resident, but qualify for split year rtreatment, so that they are effectively treated as non-resident from 14 May 2018.

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Replying to Vile Nortin Naipaan:
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By Tax Dragon
22nd May 2019 15:50

Fall foul of. That's not pedantry - that's a good point well made.

Legislation (para8) does call it "the second automatic UK test" though, so I feel I can do likewise.

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Replying to Vile Nortin Naipaan:
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By carnmores
22nd May 2019 15:55

A more reasoned reply let's cut the aggressive rhetoric

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By Tim Vane
22nd May 2019 14:48

Your adviser is an idiot. Sack him, refuse to pay for dodgy advice and appoint a new adviser.

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Replying to Tim Vane:
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By Tax Dragon
22nd May 2019 16:22

Or, as Vile intimates, read the advice more carefully.... and pay up.

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Replying to Tax Dragon:
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By carnmores
25th May 2019 11:35

that's a little unfair but we do need further information granted

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