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Temporary Non-Resident Income: HMRC Launch New Campaign

Temporary Non-Resident Income: HMRC Launch New Campaign

Have You Received a ‘Nudge’ letter from HMRC regarding undeclared temporary non-resident income?

Taxpayers who have filed a return for the 2018/19 tax year, indicating they were non-resident in the UK for this period may soon receive notice to correct their return. HMRC are writing to individuals whose records suggest they may have been temporarily non-resident for tax purposes and may not have fully declared income, such as dividends, from that period.

Why You’ve Been Contacted

HMRC has identified that, in at least one tax year since 2018/19, you reported on your Self-Assessment that you were non-resident in the UK. Based on this, HMRC believes you may fall within the rules for being temporarily non-resident.

Their records also suggest you may have received income such as dividends, interest, or capital gains while you were abroad. However, when you returned to the UK, the amounts declared on your first tax return as a resident again appear much lower, or in some cases, nothing at all.

HMRC’s concern is that certain types of income received during your time outside the UK should have been declared in the first tax year you came back. The purpose of this letter is to prompt you to review your tax returns from 2018/19 onwards, and if necessary, take steps to correct them.

Next Steps…

If you’ve received this letter, it’s important not to ignore it. HMRC expects you to go back and check your past tax returns and confirm whether you included all relevant income from your period of temporary non-residence. If anything has been missed, you may need to amend your return for the first year you became UK-resident again.

How We Can Help

Understanding the temporary non-residence rules can be complex, particularly when it comes to identifying which income needs to be reported and when. Our specialist tax advisers can help you:

  • – Review your tax position across all relevant years
  • – Identify any income or gains that should have been declared
  • – Prepare and submit amended returns or voluntary disclosures where necessary
  • – Handle all communications with HMRC on your behalf to resolve the matter as quickly and smoothly as possible

Protecting Your Tax Position

If you’ve received a HMRC nudge letter about temporary non-resident income, it’s important to act quickly. Our expert advisers can review your situation, correct past returns, and liaise directly with HMRC on your behalf.

Get in touch with our team by Filling out the form below to book a discovery call.

Discover more about HMRC Nudge Letters here.

FAQ’s

What does “temporarily non-resident” mean?

If you leave the UK for fewer than five complete tax years and then return, you’re classed as temporarily non-resident. In this case, certain types of income and gains received while abroad may still be taxable when you come back.

Do I owe tax to HMRC?

Not necessarily. The letter is a ‘nudge’ to get taxpayers to review their income for the relevant periods. It means HMRC believes there’s a risk something was not previously reported. As a result, a review of your returns is needed to confirm whether corrections are required.

What income is HMRC looking at?

HMRC are interested in obtaining information on any income including dividends, interest and capital gains. If you were in receipt of this type of income during your period of non-residence, these may need to be declared on the first self-assessment after your return to the UK.

What happens if I ignore the letter?

If you don’t check and correct your return, HMRC may open a formal compliance check and this can result in penalties and interest.

How can WTT help?

We can help you to review your returns from 2018 onwards and confirm if temporary non-resident rules apply. If required, we can take the necessary steps to correct or amend past filings and prepare a voluntary disclosure.

Author
WTT

By WTT

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