freebo

Hi,
Our plan is to move back to the UK around July/August 2021 and will be buying a house soon after then.

I've just discovered that along with the ending of the current UK Stamp Duty Holiday in April 2021 anyone buying a property who is a non UK Tax resident will be hit with an extra 2% Stamp Duty.

As we will have just arrived we won't be UK Tax residents by then but will become so during that tax year. Will we be able to claim the 2% back or would there be any way of avoiding it in those circumstances?

Due to Covid travel restrictions out of Australia I can't see us being able to buy before the April deadline and an additional cost of 2% of the value of a house is a sum I'd rather not part with.

Thanks!

ianandhelena

To be a UK tax resident, I think you have to be living there for 183 days in a tax year.

Pulaski

There are multiple other ways to become a UK tax resident.

freebo

I'm googling but not seeing too many that apply.

Pulaski

I believe this is a good guide.

ianandhelena

I agree. Maybe you can claim it back.

durham_lad

As this states, as long as you have a home instead of a something like a hotel you are resident immediately on return. We also had sold up completely before coming back and had signed a lease on a rental house because we planned on buying a house after we got back, which takes time. We arrived in May and started looking for a house which we bought in October. We paid U.K. Taxes from day 1, registered with the NHS from day 1 so no question about extra stamp duty.

UK citizens who arrive with the intent to stay are resident from day 1, subject to taxes from day 1, eligible to use the NHS etc.

ianandhelena

OPs post implies their home has been abroad, so they don’t have a home in the UK.


The stamp duty rules are recent so may not have applied to you. https://home.kpmg/uk/en/home/insight...as-buyers.html


“UK citizens who arrive with the intent to stay are resident from day 1, subject to taxes from day 1, eligible to use the NHS etc.”

Where is this this rule? This is the info OP needs.

christmasoompa

It's called 'ordinary residence'. More info on the criteria here, but essentially if a Brit returns from overseas with the intention of staying in the UK, they're considered resident from the moment they arrive. https://maternityaction.org.uk/advic...re-in-england/

HTH.

durham_lad

The OP states specially that they intend to move back to the U.K. in July/August which means they will be liable for tax from day 1, but that link you provided does clarify that the statutory residence test does not apply to the new surcharge tax and that he will need to have been in the UK for 183 days. Thanks for pointing this out to me.

I would suggest that he move back and rent a house as we did and ensure that he closes on his house purchase after 183 days.

durham_lad

Reading further in that article it says that if the purchase is made before the 183 day residence period the 2% must be paid but can be claimed back.

freebo

Thanks, that's helpful. Just need to find some corroboration.

Also-a-Durham-Lad (Darlington originally).

durham_lad

I live about 20 miles from Darlington now. Grew up in Seaham Harbour, 29 years in Texas and Louisiana before moving back.

freebo

I plan to head back to Northumberland, which is where we lived before coming to Australia.

How did you adapt to going back to the North East, its a bit different from Texas or in my case the Gold Coast of Australia?

durham_lad

It has been brilliant, like we had never left. The market town of 9k folks is about the same size as it was when we left since it is on the edge on the N. York Moors NP and surrounded by designated green field areas. Plenty of friends still here from when we left in 1987, plus my sister and family moved here 7 years ago and live close by, as does our son. He was born here but spent most of his life in Texas and Louisiana. He moved back in September 2017 and fit right in, got a job within 6 weeks, bought a house within 3 months, moved in the week before Christmas. He was a first time buyer and benefited from reduced/no stamp duty which was an incentive running at the time. He'd only ever lived in apartments in the USA so owning a house is a new experience for him.

Being retired it feels like we are on permanent holiday since we are surrounded by beautiful countryside and only 5 miles from the coast. We love Northumberland and we have a week booked in a self catering cottage in Beadnell end of September where we will meet up with my wife's sister who will drive down from Edinburgh.