RDRM11150 - Residence : The SRT: Is the work full-time overseas

An individual will be considered to work full-time overseas if they meet the sufficient hours test, as calculated over the tax year, (the relevant year) for the third automatic overseas test. This calculation will also be necessary where split year Case 1 and Case 6 apply. If they do, rather than the whole tax year it would be applied to the relevant period for these cases. (Refer to RDRM12000 onwards for split year guidance).

To calculate whether sufficient hours overseas have been worked take the following steps:

Step 1

Identify any days in the relevant tax year on which the individual does more than 3 hours work in the UK. This should include any days on which the individual also works overseas on the same day. These days are called ‘disregarded days’.

Step 2

For all employments held in the relevant tax year, including any trades carried out by the individual, add up the total number of hours worked overseas for the relevant year. This figure is not the specified contracted hours, rather it should always be the hours that were actually worked. Any hours worked overseas on disregarded days (Step 1), should be ignored. The result is referred to as the ‘net overseas hours’.

Step 3

Subtract from 365, or 366 if the relevant year included 29 February (a leap year):

  • the total number of disregarded days (Step 1)
  • any days that were part of a gap between employments (refer to RDRM11160)
  • any other days that can reduce the reference period (refer to RDRM11170).

The resulting figure is referred to as the ‘reference period’.

Step 4

Divide the result from Step 3 - the reference period - by 7. If the answer is more than 1 and is not a whole number, round down to the nearest whole number. So if the answer is 34.75 it is rounded down to 34. If the answer is less than 1 round up to 1.

Step 5

Divide the net overseas hours (Step 2) by the number resulting from Step 4. If the answer is 35 or more the individual has worked sufficient hours overseas for the relevant year.

Note: If applying this test for split year purposes any reference to relevant year should be changed to relevant period and the test applied for that period.