Tax Planning for Dual Residence

If you’re resident in multiple countries, double taxation agreements (DTAs) contain “tie-breaker” clauses to determine which of those countries has the right to tax you. These clauses consider factors such as the location of your permanent home, your financial interests, living habits and nationality.
This process requires careful analysis of your specific circumstances, and specific “Treaty relief” claims will need to be made to ensure you do not pay tax twice.

There’s no simple answer as the Statutory Residence Test considers multiple factors. It is technially possible to be non-UK resident after spending 182 out of 365 days in the UK, but at the other end of the scale the minimum number of days before triggering UK tax residence is only 16 out of 365.  Determining which end of the scale you are on depends on your previous time in the UK, as well as family, accommodation and work status in the UK. Each situation requires individual assessment from en expert advisor.

It’s possible to be a “tax nomad”, i.e. someone who does not meet the tax residence criteria for any country. This scenario has become more common in recent years due to the expansion of remote working. In response, many countries have started to tighten the rules to catch “stateless” individuals for tax.
Whilst the tax nomad status can sound appealing,  with no home country to tax your worldwide income, it can raise its own issues. You might lose access to certain tax and social security benefits (since many are for residents only) and some countries might still tax you on specific income. Each client scenario is unique, and professional advice is vital here to ensure the global nomad is able to map out a sustainable plan.