You usually have to pay tax on your UK income even if you’re not a UK resident. Income includes things like:
- rental income
- savings interest
The country where you live might tax you on your UK income. If it has a ‘double-taxation agreement’ with the UK, you can claim tax relief in the UK to avoid being taxed twice.
You do not normally pay tax when you sell an asset, apart from on UK property or land.
When tax is not due or is already deducted
Non-residents do not usually pay UK tax on:
- the State Pension
- interest from UK government securities (‘gilts’)
If you live abroad and are employed in the UK, your tax is calculated automatically on the days you work in the UK.
When to report your income to HM Revenue and Customs (HMRC)
You usually have to send a Self Assessment tax return if:
- you rent out property in the UK
- you work for yourself in the UK
- you have a pension outside the UK and you were UK resident in one of the 5 previous tax years
- you have other untaxed income
You do not need to report your income to HMRC if you’ve already claimed tax relief under a ‘double-taxation agreement’.
If you were stuck in the UK because of coronavirus (COVID-19)
If you could not leave the UK when you intended because of coronavirus, you will not have to pay UK tax on employment income that:
- you earned between the dates you intended to leave and when you actually left
- you paid tax on in your home country
Example You missed your departure flight because you were self-isolating and you worked in the UK until you could rearrange a flight home. As long as you pay tax on your wages in your home country, you will not have to pay tax in the UK.
You must file a Self Assessment tax return, together with a completed SA109 form. Use the ‘other information’ section of your SA109 to include:
- the dates you were stuck in the UK because of coronavirus
- what you earned in that time
- confirmation you paid tax on these earnings in another country
If you’re unsure how to file a Self Assessment return, you can get advice from a professional, like an accountant.
HMRC may ask you for proof that you:
- could not leave the UK when you intended, for example an NHS isolation note
- paid tax in another country on what you earned while stuck in the UK
- left the UK as soon as you reasonably could
You may have to pay tax in the UK if you cannot prove you were unable to leave the UK and did not leave as soon as you could.
Sending a Self Assessment tax return
You cannot use HMRC’s online services to tell them about your income if you’re non-resident. Instead, you must do one of the following:
- fill in a Self Assessment tax return and an SA109 form and send by post
- use commercial Self Assessment software that supports SA109 reporting (this may appear as a ‘residence, remittance basis etc’ section)
- get a tax professional to report your UK income for you
You’ll be fined if you miss the deadline - it’s earlier if you’re sending your return by post (31 October).
If you have overpaid
Apply for a refund if you think you’ve paid too much tax. This might happen if tax is deducted automatically (for example by your bank) but your total UK income is below your Personal Allowance.
HMRC will usually send refunds by cheque. If you want HMRC to send a refund straight to your bank account, include your bank account number and sort code on your tax return. You need to include this information each time you complete a tax return.
Get help from a professional (like an accountant) if you need advice.