How to avoid a big tax bill when returning from abroad

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The pandemic has changed many people’s life plans, including British citizens living abroad, who now want to return to the UK.

Many expats have made that decision in the last 18 months but perhaps without the right tax knowledge in place. It’s not as simple as just packing your bags.

It can be quite a shock for expats who may have worked in low or zero tax countries for many years.

So it’s best to do your research before making that move.

Make sure you always speak to someone in person to get the best information. We, at Kew Accountants, can advise you on the best steps forward so you don’t make an expensive mistake.

What to do

To keep things really simple, the easiest thing to do is return to the UK at the start of the tax year on April 6.

Of course, life isn’t always that simple so there are definitely other options.

If you return to the UK within five years of leaving, you may have to pay tax on some income or gains made while you were a non-resident. However, this doesn’t include wages.

How to work out if you are a resident for the tax year

The Government has a Statutory Resident Test (SRT) on its website at, which allows you to work out your residence status for the tax year.

The test looks at the amount of time you spend and/or work in the UK and the connections you have with the country.

If you have been in the UK for more than 183 days, the test is simple – you are a UK resident.

There are some safe rules to abide by too….

You will be treated as a non-resident in the UK if….

  • you were not resident in all of the previous three UK tax years and were in the UK for fewer than 46 days in the current tax year
  • you were resident in one or more of the previous three tax years and present in the UK for fewer than 16 days in the current tax year
  • you work overseas full time and work in the UK for no more than 30 days (a work day in this context being any day where an individual does more than three hours of work); and you spend no more than 90 days in the UK.

If you do not fit into the above categories, it is a case of a sliding scale to see what applies to your circumstances.

It is best to work through the questions for the test systematically. We can then offer advice on the next steps forward for your move back to the UK.  Why not look at the full list of services we offer?

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