hong_konger

The rules have changed significantly for tax year 2013/2014. You need to refer to the HMRC web site and in particular the guidance note for the statutory residence test RDR3 which explains things in great detail and gives many examples.

If you have been out of the UK for a full tax year and have not spent more time in the UK than allowed (the time allowed in the UK varies depending on a number of factors including (i) whether you have been working full time overseas in that period and (ii) whether you have been a non-resident for the previous 3 years - yes its more complicated now) then you will be not liable for tax. They have even changed (again) the method of calculating the days you have spent in the UK. In the old days you disregarded the day of arrival and day of departure. Then they reversed that to catch the weekenders so that you included the day of arrival and day of departure. They have now reached middle ground and its the number of days that you were in the UK at mid-night.

Don't worry about having property and spouse in the UK. The UK residency test only comes into play if you don't meet any of the 3 automatic overseas tests. If you don't meet any of these tests then tough luck I say.

teejaydee

The OP said she was starting work in KL in June 2014. If she intends to work in KL until 5th April 2015, she will be eligible to apply for split-year treatment from her UK date of departure until 5th April 2015. As long as she passes the RDR3 tests during that period, she will be classed as UK non-resident for the 2014-15 tax year, and no tax would be payable in the UK.

Under the "old" rules, to avoid UK tax, it was necessary to spend a full tax year as non-resident. Under the "new" rules it seems this requirement has been removed.

We don't know what the OP's ties to the UK are, or whether she will pass or fail the RDR3 tests. Nor do we know when she intends to return to the UK.

One thing that is generally agreed is that the new non-resident tests are more difficult to pass than the old ones.

As you say, hong_konger, the OP would be well advised to study the RDR3 guidance to ensure she does not find herself being classed as UK resident, and thereby eligible to pay UK tax on her Malaysian earnings.

hong_konger

She does not meet the criteria for passing the third automatic overseas test because she has not been employed overseas "over" the full tax year. Therefore she will have to rely on the 1st and 2nd automatic overseas tests. If she was resident in the UK for none of the three tax years preceding the tax year in question (it does not sound like she has) then under the 2nd automatic overseas test she will have to have spent fewer than 46 days in the UK to meet the 2nd automatic overseas test. If (as it appears) she was resident in the UK for one or more of the three tax years preceding the tax year in question then she will have to have spent fewer than 16 days in the UK to meet the 1st automatic overseas test. As she is leaving the UK in June it appears she would not meet either of the 1st or 2nd automatic overseas tests and therefore not meet any of the three automatic overseas tests.

However, all may not be lost. The automatic UK tests and UK ties tests come into play. If she does not meet any of the automatic UK tests or the sufficient ties tests then she is not UK resident.

The requirements have certainly become much more complicated but it is arguable that it is now easier to become a non resident, but the amount of time allowed to be spent in the UK has been reduced.

JC3

Hi,

There's some useful guidance, here:

Tax TIES: Malaysia - Income Tax | KPMG | GLOBAL

JC3