Non residency status

[global]

I left the UK in 1996 to work abroad and returned at the end of 2001 after my contract expired. I left to work abroad again in May 2002 and returned in November 2003. Since my average periods back in UK did not exceed 91 days in a tax year and I had left again within the`183 day rule can I assume I was non-resident for the period up to November 2003?

[JSK TAXATION]

Regrettably it appears not.

For the period 1996 to 2001, you would be treated as Not Resident/Not Ordinarily Resident from the day of departure to the day of arrival providing you satisfied the 91 day rule as an average.

However, as regards the second period of absence, one has to be absent for a complete tax year to qualify for the 365 day rule. On this basis you would have had to have been outside the UK until 5 April 2004 in order to claim to be NR/NOR for the whole period May 2002 to Nov 2003.

John KIng ATT
johnking@tax2002.fsnet.co.uk

[Instinctive]

This is not my area of tax. However, out of curiosity, could JSK or someone else please explain to me why the two periods of absence are counted as separate periods?

Apparently, the querist spent less than 91 days on average per year in the UK. He also did not spend more than 183 days in the UK. If he did not breach either rule, surely he would qualify?

Ramnik
ramnikrp@hotmail.com

[JSK TAXATION]

Ones residence status is statutorily based on a tax year but by concession the Revenue allow split year treatment provided the absence spans a complete tax year.

Since the querist first period outside the Uk ended at the end of 2001 his NR/NOR status would presumably also end at that point.

One could possibly argue that the querist knew at the time of the end of the first contract that the second was in the pipeline and on that basis the period back in the UK between the contracts is blurred. Much would depend on the querist's intentions after the end of teh first contract and how these were communicated (if at all) to the Revenue.

John King
johnking@tax2002.fsnet.co.uk

[global]

I was interested in the responses to my initial query. However if the 183 day rule does not appear to be applicable in my case when is it applicable? Also, I can easily argue that my career is performed normally overseas as I haven't worked in UK since 1996 and I am now working abroad for a third term. Is it possible therefore I can argue this point?

[Instinctive]

I think you should.

Ramnik
ramnikrp@hotmail.com