The Statutory Residence Test may look simple, and online flowcharts combined with AI may make it feel easy to navigate, but it's easy to make very costly mistakes when you try to DIY tax planning. This article explains those mistakes and how to avoid them.
For people who have connections to, and frequently travel to/from the UK, the importance of knowing your UK tax residence status cannot be overstated.
The recent abolition of the non-domicile (non-dom) regime, the introduction of the Foreign Income and Gains (FIG) regime and changes to UK inheritance tax rules, British expats especially, must understand their UK tax obligations. Failing to do so can lead to penalties, fines and potentially worse, and it’s all avoidable by knowing your UK tax residence status.
In June 2025, Robert Hallums and private client tax expert Laura Sant discussed the Statutory Residence Test (SRT) for Expats Unpacked (Experts for Expats video podcast). The SRT was examined in detail, discussing how it works, potential pitfalls of doing it yourself, and how HMRC may investigate and require you to verify your residence claims.
This article provides a breakdown of the conversation, including steps you can take to avoid costly missteps. This article has been written as a guide only and must not be relied upon to make any decisions, tax residency is highly personal and requires detailed assessment of your unique circumstances.
If you are looking for a detailed explanation of the SRT itself, or the flowchart, you can get that from our article: The Statutory Residence Test or watch Laura’s explainer video on YouTube.
The Statutory Residence Test was introduced in April 2013 and is HMRC’s legal framework for determining whether an individual is considered a UK tax resident in any given tax year. Unlike many other countries, UK tax residence status relies on more than just time spent in the UK, and the SRT was introduced to provide clarity, but it quickly became known for being anything but simple.
The SRT itself is designed to create a “black and white” decision tree which is often presented as a flowchart. But the questions and decisions can be nuanced and are frequently misunderstood.
Whether filing a Self-Assessment tax return or notifying HMRC via a P85 form, you must declare your UK tax residence status which will be determined by completing the Statutory Residence Test.
And if HMRC investigates your return, you’ll need concrete evidence. This could include:
As explained by Laura in the conversation, “If HMRC asks you for evidence, the emphasis is on you to provide it. If you can’t, expect a big old fight.”
Significance of UK tax changes in April 2025
Ultimately, your UK tax residence status has always had significant consequences. If you are considered UK resident, you are liable for UK tax on your global income. If you're non-resident, in most cases you're only going to be taxed on UK sources of income and gains from UK property, investments, income or pensions as a starting point. However, there may be possible reliefs available for certain income and gains for non-residents either through domestic UK tax rules or through double tax treaties with other countries.
With the Foreign Income and Gains regime’s arrival, understanding your UK residence history, especially the 10 years prior to your arrival, will affect your eligibility and tax liabilities.
In recent months, Laura commented that there’s been an increasing trend of people looking to leave the UK specifically for tax reasons, compared to previously when lifestyle or personal motivations were dominant.
Although the SRT might seem accessible, with numerous flowcharts, guides and calculators online (including our own), Laura warns against going it alone. "Five times out of ten, people who come to us with a self-assessed status have misunderstood the rules."
Errors often stem from misunderstanding key thresholds, such as work hours for full-time employment outside the UK or what constitutes an ‘accommodation tie'.
Overlooking factors like a significant break in employment or failing to account for the right number of midnights spent in the UK can easily result in being interpreted as a UK tax resident.
Importantly, HMRC won’t verify your tax residency status unless you’re under inquiry. Currently there is no tool provided by HMRC that can be fully relied upon, so it’s down to you to get it right and be ready to prove the outcome.
People are increasingly turning to artificial intelligence tools, like ChatGPT, for answers to complex questions, including UK tax residency status.
But while AI can provide a starting point and provide information, relying on it as your sole source of truth is risky, especially with something as technical and nuanced as the Statutory Residence Test .
As Laura Sant explained, “It’s risky. We often speak to people who think they’ve worked it out using the sufficient ties test or full-time work abroad, but they’ve missed a key rule or made an incorrect assumption.”
AI models like ChatGPT are trained on publicly available data, not on your personal situation. While it may describe the rules of the SRT with reasonable accuracy, it cannot apply them to your circumstances with any precision or reliability.
Some of the key risks include:
Unfortunately, tax decisions made on flawed assumptions, regardless of how they came about, can lead to HMRC disputes, penalties, or unexpected tax bills. It can also lead to you mistakenly planning your time in the UK incorrectly.
Ultimately, AI will not take the rap. If a tax advisor makes a mistake, you have somewhere to turn to get support.
Some people, incorrectly, believe that events outside your control, such as COVID lockdowns or medical emergencies, may ensure they remain a non-resident for tax purposes. However, these may only grant limited relief. Laura notes that HMRC capped exceptional days to 60 during the Covid-19 pandemic and are strict about intent. For example, attending a funeral in the UK doesn’t count as an exceptional circumstance.
Even if you do get an exception, once the exceptional condition no longer applies, the clock starts ticking again. Staying beyond what’s deemed 'reasonable' can inadvertently reset your residency status.
Given the complexity, proactive tax residence planning is essential.
If you're considering a move abroad or a partial relocation, understanding how day counts, work schedule, and ties impact your tax status is crucial. But it is risky to try and determine it yourself, especially if your circumstances are nuanced.
If you’re unsure about your current or future tax residence status, it’s worth speaking to someone who can provide detailed, reliable guidance.
Understanding your UK tax residence status isn’t something to take lightly, or attempt to do yourself (or through ChatGPT) especially when a mistake can result in significant financial and legal consequences.
Whether you're leaving the UK, arriving, or spending time in multiple countries each year, expert advice can help ensure you're fully compliant and taking advantage of every legal opportunity.
