Tax if you return to the UK (2024)

FAQs

Tax if you return to the UK? ›

If you come back to the UK after living abroad, you'll usually be classed a UK resident again. This means you pay UK tax on: your UK income and gains. any foreign income and gains - although you may not have to if your permanent home ('domicile') remains outside the UK.

You are subject to the same rules as someone who never left. You pay taxes on UK income and gains and any foreign income and gains (unless your permanent home remains outside of the UK). You may need to register with HMRC for self-assessment. Pension - If you had a pension abroad, you can consider moving it to the UK.

46 Days - If you spend less than 46 days in the UK in any year, you will maintain your non resident status (provided you have not been classed as a UK resident for the previous 3 tax years. If you have had non resident status for less than this, you must spend less than 16 days in the UK).

You must report foreign income or gains of £2,000 or more, or any money that you bring to the UK, in a Self Assessment tax return. You can either: pay UK tax on them - you may be able to claim it back. claim the 'remittance basis'

The US-UK tax treaty is an essential tool for US citizens living in the UK, offering protection against double taxation, reduced withholding tax rates, and clarity on tax residency. While the treaty provides numerous benefits, claiming them requires understanding and filing specific forms.

90 day tie – the individual has been present in the UK for more than 90 days in either of the previous two tax years. Country tie – the individual is present in the UK at midnight in the tax year as much as (or more than) they are present in any other single country. This tie applies to 'leavers' only (see below).

This five-year period is from when the individual's sole UK tax residence ceases. If a non-resident becomes resident again in the UK during this five-year period, any assets sold after leaving the UK will be taxed in the UK when the individual returns.

You can live abroad and still be a UK resident for tax, for example if you visit the UK for more than 183 days in a tax year. Pay tax on your income and profits from selling assets (such as shares) in the normal way. You usually have to pay tax on your income from outside the UK as well.

The more days an individual spends in the United Kingdom, the fewer UK ties are needed for them to pass the sufficient ties test and be UK resident. This ranges from one tie if they spend more than 120 days in the United Kingdom to four ties if they spend fewer than 46 days in the United Kingdom.

Do I have to pay US taxes if I live in the UK? ›

Yes, if you are a U.S. citizen or a resident alien living outside the United States, your worldwide income is subject to U.S. income tax, regardless of where you live. However, you may qualify for certain foreign earned income exclusions and/or foreign income tax credits.

UK residents have to pay tax on their UK and foreign gains. Non-residents have to pay tax on income, but usually only pay Capital Gains Tax either: on UK property or land. if they return to the UK.

There are no legal limits on the amount of money you can send to the United Kingdom. The UK only restricts the amount of cash you can physically bring into the UK. You have to declare cash of £10,000 or more. But there are no limits on money transfers sent through the banking system.

U.S. expats in U.K. cities have set income tax rates, ranging from 0% to 45%. Similar to taxes in the U.S., the percentage of tax that you pay increases as your income increases into different bands (known as brackets in the U.S.).

Your home country should give you double tax relief by giving a credit for UK taxes paid. However, if you are resident in a country with which the UK has a double taxation agreement, you may be eligible for relief from UK tax if you spend fewer than 183 days in the UK and you have a non-UK employer.

If you come back to the UK after living abroad, you'll usually be classed a UK resident again. This means you pay UK tax on: your UK income and gains. any foreign income and gains - although you may not have to if your permanent home ('domicile') remains outside the UK.

Your identity document (for example your passport or identity card) will be checked when you arrive at a UK port or airport to make sure you're allowed to come into the country. It should be valid for the whole of your stay. You may also need a visa to come into or travel through the UK, depending on your nationality.

A person seeking to return to the UK as a returning resident must apply for and be granted an entry clearance as a returning resident before they arrive in the UK. They must have previously been granted settlement in the UK, which has lapsed by operation of law due to their absence from the UK.

To advise them when you return to the UK, or you can phone the Self Assessment helpline (after 4 September 2023) on 0300 200 3310. My colleagues can then advise if a tax return is required and can ensure that a revised tax code is issued to your employer.