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April 1, 2020
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Coronavirus & The Statutory Residence Test

Measures implemented in countries around the world to combat coronavirus will impact the UK residence status of many taxpayers.

Many of the tests set out in the Statutory Residence Test (SRT) are based on day counting, with a day in the UK generally being a day on which you are in the UK at midnight.

For some of the tests it is possible to ignore days attributable to exceptional circumstances – up to a cap of 60 days per tax year.

HMRC typically views exceptional circumstances as being an event outside of the taxpayer's control that prevents them from leaving the UK (although rarely HMRC may accept that a taxpayer outside the UK may return for exceptional circumstances – such as the death/serious illness of a spouse or child).

HMRC have issued guidance in RDRM11005 confirming that days spent in the UK as a result of the following will count as exceptional circumstances:

  • Quarantine/self-isolation in line with advice from a health professional, or public health guidance
  • Government advice not to travel from the UK
  • Unable to leave UK due to closure of international borders
  • Asked by employer to temporarily return to the UK

This list is not necessarily exhaustive as there may be other coronavirus related situations that meet the threshold to be exceptional circumstances.

Notwithstanding the exceptional circumstances rule, there will be other cases where taxpayers who expected to be non-UK resident will no longer meet the necessary conditions.

For example; taxpayers working overseas who would normally qualify as non-UK resident under the third automatic overseas test may find they do not work an average of 35 hours per week, or have a significant break from work because they are made redundant or placed on unpaid leave. Such taxpayers will need to review the other SRT tests to determine their residence status.

PD Tax’s Recommendation

Anyone who lives or works overseas and whose work or travel arrangements in 2019/20 or 2020/21 have been affected by the coronavirus should review their UK residence status.

Related Articles

All about the Coronavirus Job Retention Scheme (27 March 2020)

PD Tax Tip: Covid-19 & Tax Compliance (25 March 2020)

Coronavirus Self-Employed Income Support Scheme (26 March 2020)

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