Statutory Residence Test - HM Revenue & Customs

Period of temporary non-residence
remuneration rules. EIM45805 and EIM45810 contain detail of the
rules.
Certain lump sums paid by UK pension schemes in respect of which a
charge on receipt is removed by a double taxation agreement. Detailed
guidance will be provided in due course and a link to that guidance will
appear here.
Certain taxable property deemed income and gains of a pension
scheme charged to tax on a scheme member. This replaces and
updates the existing temporary non-residence charge. Detailed
guidance will be provided in due course and a link to that guidance will
appear here.
6.15 Where you receive, or become entitled to, any of the above during a
period of temporary non-residence you will be taxed as if you received, or
became entitled to, them in the period of your return.
Example 45
Toby leaves the UK on 5 August 2013 for a six year contract of employment
abroad. He is 56, has reached normal minimum pension age, and has lived all
his life in the UK.
Toby receives £100,000 as a tax-free pension commencement lump sum and
£300,000 in flexible drawdown from his UK registered pension scheme on 20
April 2014. As he is not resident in the UK for tax year 2014-15, in accordance
with the terms of the double taxation agreement between the UK and the
country in which Toby is resident at the time, no income tax is deducted or
due in respect of the £300,000 paid as flexible drawdown.
Due to a change in his personal circumstances Toby has to return to the UK
earlier than he had anticipated; he becomes UK resident once more for 2016-
17 (UK part of split year commencing 2 September 2016). He therefore finds
that he was temporarily non-resident under the statutory residence test.
Under the relevant provisions the £300,000 taken as flexible drawdown is a
‘relevant withdrawal’. As it was paid during Toby’s period of temporary nonresidence
and was not charged to tax in the UK, the £300,000 is taxable as
pension income as though it accrued in the period of Toby’s return to the UK
rather than at the time it was received.
Remitted foreign income
6.16 Where you:
use the remittance basis, and
remit relevant foreign income to the UK during the period in which you
are temporarily non-resident,
RDR3 75