What is the statutory residence test and how does it work?

Sep 28, 2021 | Personal finances

In our previous blog post, we looked at how HMRC, the UK tax authority, uses the terms ‘resident’, ‘non–resident’ and ‘domiciled’ to describe the situation of people living in the country. 

Each term has a specific meaning relating to your tax liability, so you need to know which of those terms mean and which ones apply to you so you can work out what you need to pay.

But how do you know exactly whether you’re resident in the UK or not? 

Statutory residence test (SRT)

The Government has used the SRT since April 2013 to work out someone’s residence status for the tax year. 

Each tax year is assessed separately, which means you could be a UK resident in one year but not the next, or vice versa.

The SRT takes various factors into account to work out your residency, such as the amount of time you spend living and working in the UK, and the connections you have with the country.

There are multiple tests to determine your residency, but you might be able to skip all of that with one question: have you spent at least 183 days in the UK during the current tax year? If you answer ‘yes’, you’re a UK resident.

If you haven’t, don’t worry – you might still be able to be classified as one if you fulfill one of the following tests.

Automatic overseas test

The first is the automatic overseas test, which is split into three further miniature tests. If you pass any, you are non-UK resident.

First, if you were resident in the UK for one or more of the three tax years before the current one and you spend fewer than 16 days in the UK in the tax year, you’re not a UK resident.

Under the second test, you’ll be non-UK resident if you weren’t resident for any of the last three tax years, and spend fewer than 46 days in the UK in the current tax year.

Finally, you’ll be non-UK resident if you work full-time overseas over the tax year and:

  • you spend fewer than 91 days of the tax year in the UK
  • the number of days you have more than three hours of work in the UK is less than 31.
  • you do not have a significant break from your overseas work of at least 31 days. 

Automatic UK tests

If you don’t meet any of these criteria, then the automatic overseas test will apply. It’s also split into three smaller tests, the first of which is the ‘183 days’ trial we touched on earlier.

The second says you will be UK resident for the tax year if you have, or have had, a UK home for all or part of the year and the following all apply:

  • you have a home in the UK for at least 91 days in a row in the current tax year
  • you spend at least 30 of those days living in that home
  • you have no overseas home. If you do, you were only present in it for fewer than 30 days in the tax year. 

Under the third automatic UK test, you’ll be a UK resident if you work full-time in the UK for any period of 365 days, and 75% of those days are in the UK. 

Sufficient ties test

If you don’t meet any of the automatic overseas or automatic UK tests to be a UK-resident, you can use the sufficient ties test to work out your residence status.

In this test, ‘ties’ refers to the connections you might have to and within the UK, including a family, accommodation and work connections. 

Your ties are taken into account, along with the number of days you spent in the UK in the tax year under consideration, to determine your residency status.

The following table shows how many ties and how many days you need to have to be a UK resident if you were one for at least one of the previous tax years:

Days spent in the UK in the tax year under consideration UK ties needed
16-45 At least four
46-90 At least three
91-120 At least two 
Over 120 At least one

If you weren’t resident for at least one of the previous three tax years, you’ll have to work out your residency based on this table:

Days spent in the UK in the tax year under consideration UK ties needed
46-90 All four
91-120 At least three
Over 120 At least two

The sufficient ties test, automatic overseas test and automatic UK test are the three main methods used to work out residency in the UK. 

There are, however, tests to work out the residency of a deceased individual or of someone who arrives in the UK part way through the tax year.

Get in touch with us to help work out your UK residency.