Welcome to Hoxton Wealth, the new home of Hoxton Capital
UK Tax for International Clients
Hoxton Tax • UK Tax for International Clients
Autumn Budget 2024
Living outside the UK does not automatically mean you are outside the UK tax system.
UK tax for international clients is shaped by residence, source of income, location of asset, timing and treaty protections - and misunderstandings are common. At Hoxton, we help internationally mobile individuals, families and business owners understand what still connects them to the UK, what does not, and how to manage risk with confidence.
UK Tax residence
Your UK tax position is first determined by whether you are UK resident or non-UK resident under the Statutory Residence Test (SRT).
Residence is assessed for each UK tax year, running from 6th April to 5th April, and considers days spent in the UK, work patterns, and connections such as family and accommodation. Even where someone is non-UK resident, UK tax obligations do not disappear entirely - which is where many issues arise.
UK taxation for non-UK residents
Non-UK residents are generally taxed only on certain UK-source income and gains, rather than on worldwide income.
Common UK tax exposures for non-residents include UK employment duties (even where paid overseas), UK rental income, UK business or trading income, UK pensions and UK property disposals. The detail including rates, exemptions, withholding tax and reporting requirements depends on UK domestic law and any applicable double taxation treaty.
How does this impact you?
Taxable UK income may include UK rental income, UK employment income linked to UK duties, UK pensions and annuities, certain UK investment income, and gains on UK property. Not all UK-source income is automatically taxable - exemptions and treaty reliefs often apply.
The UK does not have a general exit tax on leaving the country. However, temporary non-residence rules can bring certain income or gains back into charge if UK residence resumes within 5 years of you becoming non-UK resident.
Double taxation treaties allocate taxing rights between countries, prevent the same income being taxed twice and may reduce or eliminate UK taxation rights. Treaties do not override UK law entirely, and relief must be claimed correctly.
In some cases, where an individual is ‘dual resident’, the treaty helps determine where the individual is treaty resident for the purpose of reading the treaty. This is particularly important where you find yourself tax resident in more than one jurisdiction at the same time.
Disregarded income is certain UK-source income of a non-UK resident individual which, under UK tax legislation, is not subject to any further UK income tax liability. It is not that the income falls outside the scope of UK taxation. Rather, the legislation provides that, to the extent UK income tax has been deducted at source (for example, under the basic rate withholding regime), no further income tax is payable.
A UK tax return is still required to declare the income and make the claim, but the disregarded income itself does not give rise to additional UK tax liability beyond the tax already withheld.
Non-UK residents are still required to complete a UK tax return and in practise, will want to assess each year whether the disregarded income scheme is most beneficial; in claiming this basis of taxation, the personal allowance is lost meaning other UK income, might fall more within UK taxation.
UK rental income remains taxable in the UK even if you live abroad. As a non UK resident, tax is either withheld at source by a letting agent or the tenant.
In most cases overseas landlords will be eligible to join the Non-Resident Landlord Scheme, which stops the automatic deduction of tax and can provide a cash flow advantage.
In either case, a UK tax return will still be required, regardless of whether you are part of the Non Resident Landlord scheme or not.
When calculating the profit subject to tax, relief for allowable expenses is available.
UK pensions often remain taxable in the UK after you move overseas. However, many double taxation treaties reallocate taxing rights to the country of residence, subject to specific conditions. The treatment depends on the type of pension, how and when benefits are drawn, and whether treaty relief is correctly claimed.
Yes. HMRC regularly review and challenge residence positions. Maintaining accurate day-count records, travel logs, work patterns and supporting documentation is critical. Clear evidence is often decisive in preventing or resolving disputes.
Why Hoxton?
UK tax for international clients is rarely straightforward. Residence rules, ongoing UK tax exposure, reporting obligations and treaty claims are frequently misunderstood — and HMRC scrutiny in this area is increasing.
Hoxton supports internationally mobile individuals, families and business owners by providing clear, technically robust advice on how UK tax applies once you leave the UK, and what continues to require attention.
We help clients:
- Establish and defend their UK residence position, including day-count tracking, record-keeping and evidence preparation
- Understand why UK tax may still apply, even after leaving the UK, and how to manage that exposure
- Identify what UK-source income remains taxable, including rental income, pensions, employment duties and property disposals
- Navigate the Non-Resident Landlord Scheme, ensuring UK property income is reported correctly and tax is paid efficiently
- Manage UK pension taxation overseas, including the interaction between UK rules and double taxation treaties
- Apply treaty relief and exemptions correctly, avoiding double taxation while remaining compliant
- Understand when income may be disregarded for UK tax purposes, and how to rely on this safely
- Meet UK reporting obligations, even where little or no UK tax is ultimately due
- Respond confidently to HMRC enquiries or residence challenges, with clear records and defensible positions
We work closely with overseas advisers where appropriate, ensuring advice is joined-up, practical and defensible. Our focus is always on clarity, risk management and real-world outcomes, not theoretical positions.
Case Study: Defending a Residence Position Under HMRC Enquiry
Carlos relocated overseas but retained a UK property and continued periodic business travel to the UK. HMRC opened an enquiry, asserting that the individual remained UK resident under the Statutory Residence Test due to accommodation and work ties. The client had assumed that spending fewer than 90 days in the UK was sufficient to remain non UK resident, and had not fully analysed the SRT.
Hoxton Tax was engaged to review the position. We conducted a detailed SRT tie analysis, reconstructed travel records and reviewed employment duties to assess UK workday exposure. We also examined the applicable Double Taxation Treaty and successfully advanced a treaty residence argument, securing relief from UK taxation on overseas earnings. Alongside resolving the enquiry, we worked closely with the client to understand the impact of future travel patterns and UK connections, providing a clear framework to manage UK residence risk going forward.
How Can We Help You?
If you would like to speak to one of our advisers, please get in touch today.
Contact Hoxton Wealth
We are available to discuss how Hoxton Wealth can help you achieve your financial goals. Together, we can help you build a brighter financial future.
