Residence & domicile

Question 1

Explain the remittance basis for paying tax

Answer 1

A UK resident who is non-UK domiciled may choose to pay UK tax only on income/gains they bring to the UK

Question 2

Define the Cinderella clause.

Answer 2

A day spent in the UK is classed as an individual who has been here at midnight on any given day. This was expanded to include those who spend their days in the UK but were not physically present in the country at midnight

Question 3

In what scenarios is an individual automatically resident in the UK?

Answer 3

Spent >183 days in the UK in a tax year
Have a UK home and spent at least 91 consecutive days there

Question 4

In what scenarios is an individual automatically NOT resident in the UK?

Answer 4

Spent <46 days in the UK in a tax year & weren’t UK resident for any of previous 3 tax years
Spent <16 days in the UK in the current tax year
Work full-time outside the UK, spent <91 days in the UK and work <31 days in the UK

Question 5

How would an individual come to be subjected to the Sufficient Ties Test?

Answer 5

If they are present in the UK between 46 and 183 days in the tax year

Question 6

Name the ties to the UK as classed under the Sufficient Ties Test.

Answer 6

Family - family members in the UK
Place to stay - available for continuous period of 91 days
Work - at least 40 days work in the UK
90-days - 90 days in the UK in at least 1 of the past 2 tax years
Country - more time spent in the UK than any other country

Question 7

What is the difference between an arriver and a leaver?

Answer 7

Arriver - those not resident in any of the past three tax years
Leaver - those resident in any of the previous three tax years

Question 8

How many ties are needed to be classed as a UK resident for a leaver?

Answer 8

16-45 days in the UK: 4
46-90 days in the UK: 3
91-120 days in the UK: 2
121-182 days in the UK: 1

Question 9

How many ties are needed to be classed as a UK resident for an arriver?

Answer 9

16-45 days in the UK: N/A - not resident
46-90 days in the UK: 4
91-120 days in the UK: 3
121-182 days in the UK: 2

Question 10

Name the four forms of domicile

Answer 10

Of origin - acquired from father
Of dependence
Of choice
Deemed - if UK resident for 15/20 past tax years

Question 11

If an individual is paying tax on the remittance basis, can they take advantage of the PA & CGT AEA?

Answer 11

No

Question 12

What is the annual charge paid to remain on the remittance basis?

Answer 12

£30k if resident 7/9 past tax years
£60k if resident 12/14 past tax years
No charge if under 18 or foreign income <£2k