What is UK tax residence?
Answered 17 March 2026
UK Tax Residence
UK tax residence operates differently depending on whether the taxpayer is an individual or a company.
What the law says
Individuals
For individuals, "resident" means resident in accordance with the Statutory Residence Test (SRT) in Part 1 of Schedule 45 to the Finance Act 2013. The SRT applies from the tax year 2013-14 onwards.
A UK-resident individual is chargeable to capital gains tax on gains accruing on the disposal of assets wherever situated. The SRT provides that individuals meeting the applicable tests for a tax year are taken to be resident for the whole of the year, subject to split-year treatment under Part 3 of Schedule 45.
Companies
For companies, the rules are set out in Chapter 3 of Part 2 of CTA 2010:
- A company incorporated in the United Kingdom is UK resident for the purposes of the Corporation Tax Acts — even if a different place of residence is given by a rule of law.
- A company not incorporated in the UK may nonetheless be UK resident under common law (i.e. where its central management and control is exercised in the UK), and special rules preserve that residence in certain circumstances such as cessation of business or winding up.
- A company treated as resident in another territory under a double taxation arrangement is treated as non-UK resident.
A UK-resident company is chargeable to corporation tax on all its profits wherever arising, whereas a non-UK resident company is only within the charge if it carries on a trade through a UK permanent establishment.
HMRC guidance / practice
Individuals — the SRT in practice
HMRC's guidance confirms that UK residence for individuals is determined by reference to the Statutory Residence Test, with detailed guidance found in HMRC manual RFIG20000 and the RDR3 Guidance Note.
The SRT comprises three layers of tests applied in sequence:
- Automatic overseas tests — if met, the individual is non-UK resident;
- Automatic UK tests — if met (and no automatic overseas test is met), the individual is UK resident;
- Sufficient ties test — if neither set of automatic tests is conclusive, residence is determined by reference to the number of UK ties the individual has combined with the number of days spent in the UK.
Key concepts under the SRT include: what counts as a day spent in the UK, what constitutes a home, and what amounts to UK work.
A split year may arise where a tax year is divided into a UK part and an overseas part under Part 3 of Schedule 45 to FA 2013.
For trustees, residence is determined by the residence of the persons who are trustees at any given time — applying the SRT for individual trustees and company residence rules for corporate trustees.
Companies
HMRC guidance confirms that guidance on company residence (including the central management and control test) can be found in the "Company residence: contents" section of HMRC manuals.
Citation sources
Period A - This is the last residence period for which the individual had sole UK residence, immediately preceding a residence period for which the individual does not have sole UK residence. Period of return - This is the first residence period after period A for which the individual has sole UK residence. Resident - The term resident referred to in TCGA92/S10A* and elsewhere in the TCGA for 2013-14 and later years, is defined for Capital Gains Tax purposes in accordance the Statutory Residence
The CARF at Section I (A) sets out the nexus rules and provides a commentary in chapter 3 to support the rules. The nexus rules outline 4 ways in which a RCASP can have a link to a jurisdiction. The 4 nexuses are: Section I A(1) – tax resident in a jurisdiction Where a RCASP is an entity or individual and is resident for tax purposes in the UK, they will be subject to the reporting and due diligence requirements in the UK. This means that the RCASP mustprovide the required information to HMRC.
norms and not have the effect of redefining residence in a way ‘that takes the words unmistakably past their accepted usage’ (Couzin, at p. 136), including the definitions of residence that were in effect in the two states at the time the Treaty was drafted.” 51. In the light of the above authorities, we start with the tax background when the UK/USA double tax convention was entered into before considering the text of the OECD model convention, and the OECD commentary on the convention, applicab
Part 1 Capital gains tax and corporation tax on chargeable gains Chapter 1 Capital gains tax Territorial scope of charge Territorial scope 1A 1 A person who is UK resident for a tax year is chargeable to capital gains tax on chargeable gains accruing to the person in the tax year on the disposal of assets wherever situated. 2 In the case of individuals who are UK resident for a tax year, see also— za Schedule D1 (relief for new residents on foreign gains), a Schedule 1 (foreign gains accruing to
The terms resident and ordinarily resident are defined as having the same meaning as in the Income Tax Acts. The terms domicile and deemed domicile (from 6 April 2017) should also be interpreted on the same basis as applies for Income Tax. References in the legislation to a person being domiciled in the UK should be taken to include a person who is domiciled in any of England, Wales, Scotland or Northern Ireland. The United Kingdom does not include the Isle of Man or the Channel Islands. Guidan
Watch a recorded webinar about the statutory resident test. This webinar explains the importance of residence and the various tests that form the statutory residence test. You will learn about: automatic overseas tests automatic UK tests the sufficient ties test what is meant by a day spent in the UK what a home is what UK work and overseas is the records you need to keep to support your decision
The rules contain the following terms relating to the residence status of the employee in the United Kingdom. They are used in this guidance. It is important to understand what they mean. You may need to look up the definitions at the references given below, but in very general terms the meanings are as follows: Residence - UK residence is determined by reference to the Statutory Residence Test, see HMRC manual RFIG20000 . Qualifying new resident - An individual is a qualifying new resident if h
Part 2 Charge to corporation tax: basic provisions Chapter 3 Company residence Companies incorporated in the United Kingdom 14 1 A company which is incorporated in the United Kingdom is UK resident for the purposes of the Corporation Tax Acts. 2 Accordingly, even if a different place of residence is given by a rule of law, the company is not resident in that place for the purposes of the Corporation Tax Acts.
” has the meaning given by section 989 of ITA 2007 ; “ permanent establishment ”, in relation to a company, is to be read in accordance with Chapter 2 of Part 24 of CTA 2010; “ personal representatives ” has the same meaning as in the Corporation Tax Acts (see section 1119 of CTA 2010) ; “ property investment LLP ” has the meaning given by section 1004 of ITA 2007 ; “ qualifying new resident ” has the meaning given by section 845B of ITTOIA 2005 (which sets out the circumstances in which an indi