When it comes to UK taxation, your residency status plays a crucial role in determining your tax liabilities. The Statutory Residence Test (SRT) is the official framework used by HMRC to assess whether an individual qualifies as a UK tax resident for a given tax year. Whether you're an expat, a frequent traveler, or someone with business interests in the UK, understanding the SRT can help you manage your tax obligations effectively.

What Is the Statutory Residence Test (SRT)?

The Statutory Residence Test was introduced in 2013 to provide a clear and objective method of determining an individual's residency status. The test is structured around three key components:

1. Automatic Overseas Test – Determines if you are not a UK resident.

2. Automatic UK Test – Determines if you are a UK resident.

3. Sufficient Ties Test – Assesses your connections to the UK if the first two tests are inconclusive.

The Automatic Overseas Test

You will automatically be considered not a UK resident if you meet any of the following conditions:

• You were a UK resident in one or more of the previous three tax years but spent fewer than 16 days in the UK in the current tax year.

• You were not a UK resident in any of the previous three tax years and spent fewer than 46 days in the UK in the current tax year.

• You work full-time abroad (at least 35 hours per week on average) and spent fewer than 91 days in the UK, with no more than 30 workdays in the UK.

If any of these apply, you are not a UK tax resident.

The Automatic UK Test

You will be considered a UK resident if you meet any of these conditions:

• You spent 183 or more days in the UK within the tax year.

• You have a UK home where you spent at least 30 consecutive days and had no overseas home.

• You worked full-time in the UK for at least 365 days, with more than 75% of your working days spent in the UK.

If any of these conditions are met, you are a UK tax resident.

The Sufficient Ties Test

If your residency status is still unclear, the Sufficient Ties Test comes into play. This test assesses your personal and professional ties to the UK, such as:

• Family ties – If your spouse, partner, or minor children live in the UK.

• Accommodation ties – If you have accessible accommodation in the UK for at least 91 days and stay there for one or more nights in the tax year.

• Work ties – If you work in the UK for 40 or more days in a tax year.

• 90-day ties – If you spent more than 90 days in the UK in either of the previous two tax years.

• Country ties – If you spend more time in the UK than in any other country during the tax year.

The number of ties required to be classified as a UK resident depends on how many days you spent in the UK. Following example, if you were UK resident in none of the three tax years before the tax year.

• 46-90 days – At least 4 ties required.

• 91-120 days – At least 3 ties required.

• 121-182 days – At least 2 ties required.

• 183+ days – Automatic UK residency applies.

Why Does Residency Matter?

Your residency status affects how much UK tax you need to pay on your worldwide income. If you're a UK resident, you will generally be taxed on your global income, while non-residents are only taxed on their UK-sourced income.

Understanding the Statutory Residence Test can help you plan your tax affairs efficiently, avoid unexpected tax bills, and make informed financial decisions, especially if you split your time between the UK and other countries.

Need Help With Your Tax Residency?

If you’re unsure about your residency status or need expert tax advice, we are here to help. Get in touch today for professional guidance on your UK tax obligations.

The above summary is based on guidance published as of January 2020. It serves as general guidance, and individual tax obligations may vary depending on personal circumstances. For tailored advice, it is recommended to consult a tax professional.