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    Moving Abroad → SRT plus Substantial Presence Test

    UK SRT plus US Substantial Presence Test, Treaty Tie-Breaker (UK to USA)

    Determining whether you are UK-resident, US-resident or dual-resident requires applying both the UK SRT (Schedule 45 Finance Act 2013) and the US Substantial Presence Test (IRC s.7701(b)). Where you are dual-resident under both countries' domestic tests, the UK-USA DTA Article 4 tie-breaker resolves treaty residence in strict sequence: permanent home, then centre of vital interests, then habitual abode, then nationality, then competent authority procedure (MAP).

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    In plain English

    Two domestic tests run in parallel. The UK uses the SRT (Schedule 45 FA 2013), explained in detail at /moving-abroad/srt. The USA uses the Substantial Presence Test in IRC s.7701(b), plus a Green Card test. You can be tax-resident in both at the same time, especially in the year you move. When you are dual-resident, the UK-USA DTA Article 4 tie-breaker decides which country gets primary taxing rights as your treaty residence. The tests are applied in order and the first one that gives a clear answer wins. You may need to disclose the treaty position on US Form 8833. The Closer Connection Exception on Form 8840 can override the Substantial Presence Test before you even reach the tie-breaker, in specific circumstances.

    How it works

    UK side, applying the SRT

    Schedule 45 FA 2013 sets a sequential three-tier test: Automatic Overseas Tests, Automatic UK Tests, Sufficient Ties. Split-year cases 1, 2 or 3 may apply in the year of departure. Full mechanics at /moving-abroad/srt. The SRT outcome determines UK domestic residence for the tax year, which the treaty may then override for treaty-allocated income.

    US side, Substantial Presence Test

    Count US days. Substantial Presence Test = (days current year) + (days prior year / 3) + (days year before that / 6). If the total is 183 or more, AND you are present at least 31 days in the current year, you are a US tax resident. Separately, Green Card holders are US tax residents regardless of presence. First-year choice (IRC s.7701(b)(4)) may let you elect into US residence partway through your arrival year if you meet specific conditions including being present 31 consecutive days plus 75 percent of the period from the start of that 31-day window.

    Treaty tie-breaker, Article 4 sequence

    Where dual-resident, apply DTA Article 4 tests in strict order. Each test is a hierarchy stopper: once you get a clear answer, you stop. 1. Permanent home: in which state do you have a permanent home available to you? If only one, that is your treaty residence. 2. Centre of vital interests: if permanent homes in both states (or neither), where are your personal and economic relations closer? Family, employment, assets, social ties. 3. Habitual abode: where do you habitually live, measured by frequency, duration and regularity of stays. 4. Nationality: of which state are you a national. 5. Mutual Agreement Procedure (MAP): competent authorities agree the position. Disclose the treaty position on US Form 8833 if claiming non-US residence under the tie-breaker as a Green Card holder, or in other treaty-position situations specified in the form instructions.

    Special cases, Closer Connection plus dual-status year

    Closer Connection Exception (Form 8840): if you are a Substantial Presence Test resident but spend fewer than 183 days in the US in the current year, have a tax home in another country, and have a closer connection to that country, you can be treated as a non-US tax resident. Critically, this is NOT available to Green Card holders. Dual-status year: the year of arrival or departure can be split into a US-resident period plus a non-resident period for US tax purposes (separate from UK split-year analysis). Different deductions and filing forms apply to each period.

    Who this applies to + key conditions

    Statute + manual references

    Primary: UK: Schedule 45 Finance Act 2013 (SRT). US: IRC s.7701(b) (Substantial Presence Test plus Green Card test). Treaty: UK-USA DTA 2001 Article 4 (residence tie-breaker).

    Related: Form 8840 (Closer Connection Exception); Form 8833 (Treaty-Based Return Position Disclosure); IRC s.7701(b)(4) (first-year choice election)

    HMRC manual: HMRC RFIG plus INTM156000+ (UK-USA treaty residence)

    Common mistakes + traps

    Worked example

    Anna, a UK national starting an H-1B job in California on 1 September 2025

    Anna was UK-resident in 2024/25. She moves to California on 1 September 2025 to start a full-time H-1B job. She keeps her London flat (rented out), spends 8 days in the UK at Christmas 2025 and 6 days in March 2026. No UK workdays after 31 August 2025. She has no US Green Card.

    1. UK SRT: split-year Case 1 (starts full-time overseas work) applies for 2025/26. UK part: 6 April to 31 August 2025 (UK-resident). Overseas part: 1 September 2025 to 5 April 2026 (non-resident), with 14 UK days well within thresholds.
    2. US Substantial Presence Test 2025: present in US from 1 September to 31 December = 122 days. Current year alone is below 183 but greater than 31, and the weighted formula (122 + 0/3 + 0/6 = 122) is below 183. So under the strict SPT she is NOT a US tax resident for the full 2025 calendar year.
    3. First-year choice election (IRC s.7701(b)(4)): Anna can elect US residence from 1 September 2025 if she meets the 31-day plus 75 percent presence conditions, which she does (continuous from 1 September). She is also likely to be a US resident for full year 2026 under SPT (full year present).
    4. Dual-residence in the cross-over period (1 September to 31 December 2025 if she elects in) is resolved by DTA Article 4. Her permanent home becomes Californian as the London flat is let; centre of vital interests is California (job, day-to-day life). Treaty residence = USA from 1 September.
    5. Disclose treaty position on Form 8833 if needed; consider dual-status year mechanics for US 2025 return.

    Outcome: Anna is UK-resident to 31 August 2025 (split-year Case 1) and treaty-resident in the USA from 1 September 2025 onwards. From 2026/27 she is automatically UK non-resident under Overseas Test 3 (full-time overseas work plus low UK days) and US-resident under SPT. She must continue UK SA filing while she has UK rental income (NRL scheme, see /moving-abroad/leaving-uk-procedures).

    How this connects to the rest of the framework

    Statutory Residence Test →

    Full UK SRT mechanics, Schedule 45 FA 2013 deep dive.

    DTA mechanics plus saving clause →

    Once treaty residence is set, the DTA articles allocate taxing rights by income type, subject to the saving clause.

    FATCA plus reporting overlay →

    US residence triggers Form 8938 plus FBAR overlay independent of DTA outcome.

    Frequently asked questions

    What happens if I miss the Self Assessment deadline?+
    The Self Assessment deadline is 31 January (online filing) for the previous tax year. Miss it and HMRC apply an automatic £100 penalty. Beyond that: £10 per day from 3 months late (capped at £900), 5% of tax due at 6 months late, and another 5% at 12 months late, under Schedule 55 of the Taxes Management Act 1970. If you have a genuine reason (serious illness, bereavement, technical issue with HMRC's systems) you can appeal with evidence; HMRC accepts reasonable excuse appeals in most genuine cases.
    Do I need an accountant or can I file Self Assessment myself?+
    Legally you can file Self Assessment yourself via gov.uk for free, most simple sole-trader returns (single income source, basic expenses) are realistic to self-file. An accountant adds real value when: your trading profit is above £40,000 (extraction-strategy decisions matter), you have multiple income streams (PAYE + self-employment + property + dividends), you've crossed the £90,000 VAT threshold, you're considering incorporation, or you have an HMRC enquiry. Expect to pay £400-£1,500/year for a typical sole-trader accountant; the cost is itself a deductible expense.
    How do payments on account work?+
    When your Self Assessment tax bill exceeds £1,000 for the first time, HMRC requires payments on account toward NEXT year's tax. Half the current bill is due 31 January (alongside the current bill); the other half is due 31 July. So your first January after crossing the threshold can hit with a double-bill: last year's balance + first payment on account. Adjust via Form SA303 if you expect next year's income to drop substantially. Payments on account don't apply if more than 80% of your tax is collected via PAYE.
    Does winning the Article 4 tie-breaker against the USA mean I can ignore my US return?+
    No. Even where treaty residence is the UK, US citizens and Green Card holders still file US returns reporting worldwide income because of the saving clause at Article 1(4). The tie-breaker affects treaty-allocated taxing rights and foreign tax credit mechanics, not the filing obligation itself. Non-US-citizen non-Green-Card holders treaty-resident in the UK generally file only on US-source income (Form 1040-NR), but disclose the treaty position on Form 8833 where required.
    What is a US 'tax home' for the Closer Connection Exception?+
    Tax home is generally your regular or principal place of business, employment or post of duty, regardless of where you maintain your family home. If you don't have a regular place of business, your tax home is your regular place of abode. The Closer Connection Exception (Form 8840) requires a tax home outside the US for the full year plus closer connection to that other country, evidenced by factors including permanent home location, family location, personal belongings, social ties and driver's licence jurisdiction.
    How do partial days count for the Substantial Presence Test?+
    Generally, any day you are physically present in the US at any time during the day counts as a full US day. Exceptions: days commuting to work in the US from a Canadian or Mexican residence (different from UK situation); days in transit between two non-US points (less than 24 hours); days unable to leave due to a medical condition that arose while present in the US; certain exempt-individual statuses (J, F, M, Q visas during exempt periods).
    What is the first-year choice and when does it help?+
    First-year choice (IRC s.7701(b)(4)) lets you elect US residence partway through your arrival year if you meet specific conditions: present in the US for at least 31 consecutive days in the current year, AND present for at least 75 percent of the period from the start of that 31-day stretch to year-end (with up to 5 days absence counted as US presence). You also need to be a Substantial Presence Test resident in the next calendar year. The election can be useful for accessing certain US deductions or filing jointly with a US-citizen or resident spouse, but it is binding for the year and worldwide income then becomes US-taxable from the election start date.

    Free + regulated-body resources

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