RDRM11370 - Residence: The SRT: Third automatic UK test

An individual works full-time in the UK for any period of 365 days, with no significant break from UK work and:

  • all or part of the 365 day period falls within the tax year
  • more than 75% of the total number of days in the 365 day period when the individual did more than 3 hours work are days when they did more than 3 hours work in the UK
  • at least 1 day which is both in the 365 day period and in the tax year is a day on which the individual does more than 3 hours work in the UK

If these conditions are met, the individual will be resident under the third automatic UK test.

If the individual identifies a period of 365 days when they worked full-time in the UK, but did not meet the 75% test relating to that 365 day period they will fail the test. However, they can then consider whether there is another 365 day period when they do meet the 75% test. If there is no such period the individual will not meet the third automatic UK test.

The third automatic test will not apply if the individual:

  • has a relevant job, at any time in the relevant tax year (see RDRM11780), and
  • at least 6 of the trips made in that year as part of that job are cross border trips (see RDRM11800), that
    • begin in the UK
    • end in the UK
    • begin and end in the UK

Example 1

Henri travels to the UK on 1 July 2013 to start a new job the following day. His posting finished on 1 July 2014, and he leaves the UK on 6 August 2014, 400 days after he arrived.

Over the 365 day period to 30 June 2014, Henri calculates that he worked full-time in the UK and has not taken a significant break from his UK work during this period. Part of the period of 365 days fall in the tax year 2013-2014 and part within the tax year 2014-2015.

Over the period of 365 days ending 30 June 2014, Henri works for over 3 hours on 240 days, 196 (80%) of which are days when Henri worked for more than 3 hours in the UK. At least 1 day when Henri does more than 3 hours work in the UK falls within tax year 2013-2014; therefore Henri is resident in the UK under the third automatic UK test for 2013-2014 tax year.

Example 2

Frank works full-time in Paris for a branch of a multi-national export company. He comes to work in the UK every month for 2 days; on both days he works for more than 3 hours in the UK. On 1 September 2013 Frank is seconded to work in the UK for a period of 2 years. Frank returns to the Paris office and works there for more than 3 hours on 2 days each month.

In the period of 365 days ending 5 April 2014 Frank calculates he worked full-time in the UK, (the days worked overseas are identified and disregarded at Step 1 of the calculation of full-time work overseas). As Frank worked for more than 3 hours on 2 days each month in the UK prior to September 2013, Frank did not have a significant break from UK work.

In the 365 day period ending 5 April 2014, Frank worked for more than 3 hours on 240 days. However, only 150 days (62%) were days when Frank worked for more than 3 hours in the UK. Using that 365 day reference period Frank would not be resident in the UK under the third automatic UK test for the 2013-2014 tax year. Frank needs to check the 75% test against another 365 day period.

In the 365 day period ending 31 August 2014, Frank calculates he worked full-time in the UK. Again days worked overseas are identified and disregarded at Step 1 of the calculation of full-time work overseas. In the 365 day reference period ending 31 August 2014, Frank worked for more than 3 hours on 230 days; 210 days (91%) were days when Frank worked for more than 3 hours in the UK. Part of this 365 day period falls within the 2013-2014 tax year and at least 1 day in 2013-2014 is a day on which Frank worked for more than 3 hours in the UK. Therefore, using the 365 day reference period ending 31 August 2014, Frank is resident in the UK under the third automatic UK test for 2013-2014.