UK tax residence and UK domicile are two distinct legal concepts. From 6 April 2025, UK tax residence drives income tax and CGT under the Statutory Residence Test at FA 2013 Schedule 45, and substantially drives IHT via the Long-Term Resident test at IHTA 1984 ss.6A-6C. UK domicile no longer drives income tax or CGT and only residually operates for IHT trust mechanics, private international law, and certain double taxation agreements.

This page is the hub primer for the entire residence-and-domicile cluster. It walks through the SRT cascade, the new LTR test, the split-year Cases, the temporary-non-residence anti-avoidance, the NRL scheme and NRCGT continuity points for UK-property investors, and then routes the reader to the four existing deep-dive pages on FIG, TRF, CGT rebasing, and the IHT LTR architecture. For the historical context on what the remittance basis was and what replaced it, see the companion remittance basis page.

Why residence (not domicile) now drives almost everything

The pre-6-April-2025 framework gave domicile a privileged role: foreign-domiciled UK residents could claim the remittance basis on foreign income and gains, and the deemed-dom 15-of-20 test brought worldwide IHT exposure with a generous lag. From 6 April 2025 that architecture was rewired:

  • Income tax and CGT. The remittance basis was abolished by FA 2025 s.40 and Schedule 9. UK residents are taxed on a worldwide arising basis, subject only to the new 4-year FIG exemption for qualifying new arrivals.
  • IHT. The historic deemed-dom architecture was replaced by the residence-based LTR test under IHTA 1984 ss.6A-6C. Worldwide-IHT exposure now depends on UK-residence pattern, not domicile.
  • Trust attribution. IHTA 1984 s.48ZA (inserted by FA 2025) gives a residence-based treatment of excluded-property trusts. The settlor's residence status at the date of trust creation drives the treatment, not domicile.

The headline framing is straightforward: residence is now the master concept. Domicile retains residual operation but no longer drives the mainstream UK tax position. Competitor pages still routinely discuss "non-dom status" as if it confers a current UK tax advantage; that framing is out of date.

The Statutory Residence Test in three stages

FA 2013 Sch 45 establishes a three-stage cascade. The individual works through the stages in order; the first stage that gives a clear result determines residence for that tax year.

Stage 1: automatic non-residence tests

If any one of the three automatic non-residence tests is met, the individual is automatically non-resident for the tax year:

  • Test 1 (the leaver test): fewer than 16 days in the UK in the tax year, AND UK-resident in any of the three preceding tax years.
  • Test 2 (the non-leaver test): fewer than 46 days in the UK in the tax year, AND NOT UK-resident in any of the three preceding tax years.
  • Test 3 (the full-time-work-abroad test): full-time work overseas with limited UK presence and limited UK workdays, as defined in detail at Sch 45 para 14.

If none of the automatic non-residence tests is met, the cascade moves to Stage 2.

Stage 2: automatic UK residence tests

If any one of the three automatic UK residence tests is met, the individual is automatically UK-resident:

  • Test 1: 183 or more days in the UK in the tax year. The simplest and most-common positive case.
  • Test 2 (the UK home test): the only home is in the UK, OR all homes are UK-based and the individual is present in a UK home for 91 or more days in the year.
  • Test 3: full-time work in the UK over a 365-day period that straddles the tax year, subject to the detailed definition.

If neither automatic test gives a result, the cascade moves to Stage 3.

Stage 3: sufficient ties test

The ties test combines day-count with the number of UK ties. Four ties are available for arrivers (individuals not UK-resident in any of the three preceding tax years):

  • Family tie: spouse, civil partner, or minor child resident in the UK.
  • Accommodation tie: available UK accommodation used for at least one night in the year.
  • Work tie: 40 or more days worked in the UK in the year (3 hours' work in a UK day counts as a workday).
  • 90-day tie: 90 or more days in the UK in either of the two preceding tax years.

Leavers (individuals UK-resident in any of the three preceding tax years) also have a fifth tie:

  • Country tie: more days in the UK than in any other single country.

The day-count matrix (Sch 45 para 18 for arrivers; para 19 for leavers) sets the ties threshold for residence. For arrivers: 16 to 45 days requires all 4 ties; 46 to 90 days requires 3 ties; 91 to 120 days requires 2 ties; 121 to 182 days requires 1 tie. For leavers the matrix is harsher (residence triggers at lower day-counts).

Split-year treatment in eight cases

SRT determines residence on a year-as-a-whole basis. Split-year treatment under Sch 45 Part 3 allows the year to be split into a UK-resident part and a non-resident part where one of eight Cases is met. Each case has detailed conditions; the headline framings are:

  • Case 1: starting full-time work overseas during the year.
  • Case 2: partner of someone starting full-time work overseas, joining them partway through the year.
  • Case 3: ceasing to have a UK home during the year.
  • Case 4: starting to have a UK home only, after a period without one.
  • Case 5: starting full-time work in the UK during the year.
  • Case 6: ceasing full-time work overseas during the year.
  • Case 7: partner of someone ceasing full-time work overseas, joining them in the UK.
  • Case 8: starting to have a UK home, in advance of becoming UK-resident under SRT.

Split-year claims are not automatic. The case must be claimed in the self-assessment return for the relevant year. The benefit is significant for arrivers and leavers: income and gains in the non-resident part of the year are not within UK tax (subject to UK-source exceptions, NRL scheme, NRCGT).

The new LTR test for IHT

The most consequential FA 2025 change for high-net-worth individuals is the IHT reform. The historic deemed-dom 15-of-20 test has been retired. The new test under IHTA 1984 ss.6A-6C is the Long-Term Resident (LTR) test.

  • s.6A standard rule: an individual is long-term UK resident, and therefore within UK IHT on worldwide-situs assets, if UK-resident (under SRT) for at least 10 of the preceding 20 tax years.
  • s.6B young-person variation: a modified test for individuals under 20, reflecting the shorter possible residence history.
  • s.6C departure tail: a person who has been LTR retains LTR status for a tail period after ceasing UK residence, with the length of the tail dependent on residence history. The longer the past residence, the longer the tail.

The shift is from a domicile-based test (where domicile of choice was hard to acquire and even harder to shed) to a residence-based test (where the count is mechanical against the SRT). The simplification has consequences in both directions. A high-net-worth arrival with no UK domicile of origin who reaches 10 UK-resident years comes within worldwide IHT exposure. Conversely, a UK-domicile-of-origin individual who has lived abroad for most of the preceding 20 years falls outside the LTR test and outside worldwide IHT exposure.

Temporary non-residence anti-avoidance

TCGA 1992 s.10A is the long-standing anti-avoidance against short-term emigration to crystallise foreign gains. The rule applies where an individual leaves the UK and returns within a defined "temporary period of non-residence" (broadly up to 5 years for most fact patterns). Gains realised on assets held at the date of departure that are realised during the non-resident period are charged to UK CGT in the year of return.

The s.10A rule does not bite where the non-residence is genuinely long-term (more than 5 years on the standard test). It does bite where the absence was a tax-motivated bracket and the individual returns within the threshold. Planning a departure with an early-return contingency requires explicit modelling of the s.10A trap.

The property-investor angles

Four investor-specific points carry across the residence-and-domicile architecture.

UK rental income is taxed regardless of residence

The single most-common drift in popular non-dom commentary is to imply UK rental income could ever be outside UK tax under the remittance basis. It could not. UK-source rental income from UK property has always been taxed on the arising basis, regardless of the landlord's domicile or residence. The FA 2025 reform does not change this.

The administrative architecture for non-resident landlords is the Non-Resident Landlord (NRL) scheme under ITA 2007 Part 14 Chapter 5 and SI 1995/2902. The NRL scheme uses a "usual place of abode" test, not the SRT directly. A landlord whose usual place of abode is outside the UK falls within the NRL scheme even if a borderline SRT analysis gives a different result. The scheme requires either tenants or letting agents to withhold UK basic-rate income tax on UK rental payments, unless HMRC has approved the landlord for gross-payment under the NRL1 application.

NRCGT on UK property is unchanged

TCGA 1992 Sch 4ZZB and the associated NRCGT framework apply UK CGT to non-residents disposing of UK land. The framework operates regardless of domicile. The 60-day NRCGT return is the operative compliance discipline. The FA 2025 reform does not modify NRCGT.

ATED applies to companies regardless of residence

The Annual Tax on Enveloped Dwellings applies to companies (and certain other enveloped structures) holding UK residential property valued over the relevant threshold. Company residence is irrelevant. The 5-yearly revaluation discipline is the operative compliance point.

Worldwide asset exposure turns on residence and LTR

The residence question matters most for the worldwide-asset position. A UK-resident landlord with overseas-property rental income is taxed on that worldwide income (subject to the 4-year FIG window if eligible). A UK-resident with overseas-property capital gains is taxed on those gains on the arising basis (subject to FIG; subject to the narrow CGT rebasing election for 2017-cohort claimants). The LTR test then brings worldwide-situs assets into UK IHT once the 10-of-20 threshold is reached. The investor angle is therefore: every additional year of UK residence has both immediate income / CGT consequences and an LTR-clock consequence for IHT.

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What happens if you leave the UK

Three operative tests apply on departure:

  1. SRT day-count plus ties test for the current tax year. A split-year claim under one of Cases 1 to 3 may limit UK tax to the pre-departure part of the year.
  2. NRL scheme "usual place of abode" trigger. A landlord whose usual place of abode shifts outside the UK comes within the NRL scheme. The test may bite ahead of the SRT result in some scenarios.
  3. Temporary non-residence s.10A anti-avoidance. If the absence is short enough that the individual returns within 5 years, gains realised during the absence on pre-departure assets are taxed in the year of return.

The departure planning question is: are you really leaving? A genuine long-term departure (no return within 5 years; SRT non-residence cleanly established each year) puts foreign-source gains and income outside UK tax. A short-term bracketed departure does not.

What happens if you arrive in the UK

Three planning windows apply:

  1. Split-year claim under SRT Cases 4 to 8. Limits UK tax to the post-arrival part of the year.
  2. FIG regime claim under ITTOIA 2005 s.845A. 4 years of full foreign-income and gains exemption if the 10-year-prior-non-residence gateway is met. The claim forfeits personal allowance, dividend allowance, and CGT annual exempt amount. Year-by-year modelling.
  3. IHT LTR clock. The 10-of-20 test starts ticking from the first UK-resident year. Planning around the 10-year horizon is critical for high-net-worth arrivals, particularly around trust-creation timing (excluded-property trusts created before LTR onset retain protected status under IHTA 1984 s.48ZA).

The residual operation of domicile

Domicile has not been abolished as a legal concept. It continues to operate in three contexts:

  • Trust attribution under s.48ZA transitional architecture. The boundary between excluded-property trusts created before LTR onset and those created after turns on the settlor's status at trust creation, which references domicile in some transitional fact patterns.
  • Private international law. Cross-border succession, family law, conflict of laws. The Domicile and Matrimonial Proceedings Act 1973 architecture continues to apply.
  • Double taxation agreements. Treaties that retain domicile language in the residence article (a minority of UK DTAs) continue to apply that language for treaty-purposes residence determination.

For the mainstream UK income tax, CGT, and IHT position of a typical UK-property investor, domicile no longer drives the answer. Residence does.

Worked examples

  1. UK national leaving for Dubai 1 September 2026 to take up full-time employment. SRT Case 1 split-year applies if the conditions are met. Pre-1-September portion of 2026-27 is UK-resident; post-1-September portion is non-resident. Foreign income and gains in the non-resident part are outside UK tax. NRL scheme applies on any UK rental income from the date the usual place of abode shifts. The s.10A temporary non-residence rule will catch pre-departure-asset gains if the individual returns within 5 years.
  2. US national arriving in the UK 1 March 2026 to take up full-time employment. SRT Case 5 split-year applies if the conditions are met. Pre-1-March portion is non-resident; post-1-March portion is UK-resident. FIG claim possible for tax years 2025-26 to 2028-29 if the 10-year-prior-non-residence gateway is met. The IHT LTR clock starts ticking from the first UK-resident year.
  3. UK-resident landlord with £75,000 UK rental income plus £30,000 Spanish rental income. UK rental taxed at normal arising-basis rates. Spanish rental taxed on the arising basis with Spanish tax credit available under the UK-Spain DTA (foreign tax credit relief). If the landlord is a new arriver within the FIG window and claims FIG for the year, the Spanish rental is exempt that year but the landlord loses personal allowance.
  4. Non-resident landlord (10 years overseas) with £45,000 UK rental income. NRL scheme operative; UK rental taxed on the NRL return at normal rates. UK personal allowance may be available under the relevant UK-overseas-country DTA (treaty-dependent). No UK taxation of any foreign-source income.

This page is the foundational primer. For the operational deep-dives, route to the existing pages:

  • Historical context on the remittance basis. The companion remittance basis page explains what ended on 6 April 2025 and the architectural map of what replaced it.
  • FIG regime for property investors. The FIG operational deep-dive walks through the per-year claim mechanics, the personal-allowance trade-off, and worked examples.
  • FIG year-5 cliff planning. The year-5 onwards page covers the move from FIG exemption to full worldwide arising basis.
  • TRF Sch 10 designation scenarios. The TRF page walks through the three designation scenarios under Sch 10 para 2.
  • CGT rebasing narrow eligibility. The FA 2025 Sch 11 page covers the rebasing election eligibility analysis.

If you are a UK-property-owning expat considering departure or return, a new arrival weighing UK property purchase plus tax position, an adviser running residency-and-domicile assessments for property clients, or a trust beneficiary or settlor with UK property in pre-FA-2025 structures, the form at the foot of the page is the route to a structured assessment.