Changes to UK residency laws


Proposed changes to UK tax and residency laws could have a big impact on the lives of retired UK expats- for the better.

Expats have long struggled to get to grips with HMRCs seemingly random residency laws, laws that often flaunt their own set guidelines. Problems usually arise when individuals who have followed the guidelines are instead judged on their specific circumstances, and then found to be in breach of their non-residency.

However, HMRC have now finally admitted that the rules need to be made clearer, and that a final definition of residency is to be introduced. Previously, the guidebook HMRC 6 was advised as having the rules to follow, yet its contents were always billed as having a “guideline” purpose only. Under the proposed changes HMRC 6 will be scrapped.

The new changes may also bring about an end to the ’90 day rule’ that states expats must not spend any more than 90 days in the UK during the tax year.

There are even suggestion that such retired non-residents may even be allowed to spend up to 182 in the UK in a year, providing that the last two tax years have seen them spend just 90 days in the country each year.

To establish the new rules, HMRC has actually asked for help from expatriates themselves. They will be consulting until the beginning of September 2011 and have asked that expatriates get in touch with their suggestions regarding the residency rules. Any changes that are brought in will come into effect from the 6th April 2012.

Keep checking the Expat & Offshore News section for updates regarding the changes as soon they are announced.