In short: The Statutory Residence Test (SRT) decides whether you are UK tax resident for each tax year. If you spend 183 days or more in the UK you are resident. Otherwise you check the automatic overseas tests, then the automatic UK tests, then the sufficient ties test. Owning or directing a UK company does not by itself make you UK resident.
Many founders who live abroad form a UK company. A common question is: does that make me UK tax resident? Your personal tax residence is decided by the Statutory Residence Test (SRT), which HMRC explains in its guidance note RDR3. This post is a plain-English overview. It is not tax advice, and the full rules have many details and exceptions.
Why tax residence matters
If you are UK resident, you are generally taxed in the UK on your worldwide income and gains. If you are non-resident, you are generally taxed in the UK only on certain UK income. Your company's tax position is separate from your personal one.
The tax year runs from 6 April to 5 April. The SRT looks at one tax year at a time.
How days are counted
You are normally treated as spending a day in the UK if you are in the UK at midnight at the end of that day. There are exceptions, for example for people in transit and for exceptional circumstances beyond your control. A "deeming rule" can also count extra days for some people who visit often.
Keep a travel diary and boarding passes. They are your best evidence.
Step 1: the 183-day rule
If you spend 183 days or more in the UK in a tax year, you are UK resident for that year. You do not need to look at the other tests.
Step 2: the automatic overseas tests
If any one of these applies, you are not UK resident:
- You were UK resident in one or more of the previous three tax years, and you spend fewer than 16 days in the UK in this tax year.
- You were not UK resident in any of the previous three tax years, and you spend fewer than 46 days in the UK in this tax year.
- You work full-time overseas, spend fewer than 91 days in the UK, and work more than three hours on fewer than 31 days in the UK (with no significant break from overseas work).
Step 3: the automatic UK tests
If no overseas test applies, check these. If any one applies, you are UK resident:
- You spend 183 days or more in the UK.
- You have a home in the UK for a period of at least 91 days in a row, at least 30 of which fall in the tax year, and you are present there on at least 30 days – and you have no overseas home, or you spend fewer than 30 days at your overseas home.
- You work full-time in the UK for a period of 365 days, with more than 75% of your working days (over three hours) in the UK.
Step 4: the sufficient ties test
If none of the automatic tests decides your status, you count your UK ties. The ties are:
- family – a spouse, partner or minor child who is UK resident
- accommodation – a place to live in the UK that you use
- work – doing a significant amount of work in the UK
- 90-day – having spent more than 90 days in the UK in a recent tax year
- country – the UK is the country where you spent the most time (only if you were UK resident in any of the previous three years)
HMRC's guidance sets out the exact conditions for each tie. The more ties you have, the fewer days you can spend in the UK before you become resident.
If you were UK resident in any of the previous three years:
- 16–45 days: resident with 4 or more ties
- 46–90 days: resident with 3 or more ties
- 91–120 days: resident with 2 or more ties
- over 120 days: resident with 1 or more ties
If you were not UK resident in any of the previous three years:
- 46–90 days: resident with all 4 ties
- 91–120 days: resident with 3 or more ties
- over 120 days: resident with 2 or more ties
Split-year treatment
If you arrive in or leave the UK part way through a tax year, the year may be split into a UK part and an overseas part. There are several cases with specific conditions. Check the HMRC guidance or ask an adviser.
Double tax treaties
If you are resident in both the UK and another country, a double tax treaty may decide where you are treated as resident for treaty purposes. This needs professional advice.
Running a UK company from abroad
Being a director or shareholder of a UK company does not by itself make you UK resident. But working in the UK for the company can count towards the work tie, and spending time here adds days. The company itself is UK resident for corporation tax because it is incorporated in the UK.
How Form My Company can help
Our Non-Resident Package (£1,500) is built for founders who live outside the UK, with remote identity checks and a UK registered office and service address. If you need to prove your residence to a foreign tax authority, see our Tax Residence Certificate service. For advice on your own residence position, please speak to a qualified tax adviser.
Frequently asked questions
Does owning a UK company make me UK tax resident?
No, not by itself. Your personal residence depends on the Statutory Residence Test, which looks at days in the UK, your home, your work and your ties.
How many days can I spend in the UK without becoming resident?
It depends on your history and ties. Fewer than 16 days (if recently resident) or fewer than 46 days (if not) makes you automatically non-resident.
What counts as a day in the UK?
Normally, any day when you are in the UK at midnight. There are some exceptions, such as transit.
Where can I read the official rules?
HMRC's guidance note RDR3 on GOV.UK explains the Statutory Residence Test in full.