Being non-resident for tax purposes in the UK can be a significant advantage, particularly if the country where you are working has a low tax rate or ex-pats are exempt from tax. And if you arrive in the UK and are not domiciled here, then there can be tax advantages also. But the rules for claiming non-residence or non-domiciled status are often confusing and frequently changing. Whether you are a UK national moving abroad or a foreign national living in the UK, getting the right tax advice is crucial. You will need to be aware of whether you need to complete a UK tax return and what has to be declared on it. In addition, you will need to know what expenses can legitimately be claimed against your taxable income, and how any foreign earnings are dealt with.

Being based in London, we find ourselves assisting taxpayers in these areas from three main backgrounds:

1. UK taxpayers leaving the UK to work abroad - from ex-military personnel working for security companies in Iraq and Afghanistan, to missionaries teaching in theological colleges in Africa

2. Overseas workers arriving in the UK on a short-term temporary contract who are entitled to claim a range of expenses against their UK income

3. Non-UK domiciled workers arriving in the UK, but with foreign income to declare as well as UK earnings, and possibly with tax relief to claim for overseas workdays.

In order to order your tax affairs efficiently, there are three key concepts you need to understand:

Residence for tax purposes (not to be confused with permission to remain in the UK) is a matter of fact. If you reside in the UK for an average of 91 days per tax year, then you are resident in the UK. In addition if you are in the UK for 183 days in any one tax year then you are always classed as resident. But you cannot be non-resident unless you fulfil the rules for an entire tax year. A whole year away from 1 June to 31st May will not make you non-resident. By the way, a day counts if you are in the UK at midnight on that day.

Domicile is usually determined by where you are born but can be because of your father's nationality. Most people retain their domicile of birth unless they break all connection with that country. If you are resident but not domiciled in the UK then you can claim the remittance basis of taxation for overseas income. In other words, you are only taxed on overseas income that is brought into the UK. But you will lose your personal tax allowance if your overseas income is more than
Ian Marlow runs HFM, a London tax and accounting business serving clients both resident in, and working outside, the UK. For more detailed tax information and access to their excellent free monthly tax newsletter, go to the HFM website => http://www.hfmtax.co.uk .

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