Tax Case: Statutory Residence Test and Exceptional Circumstances

In this episode of The UK Tax Podcast, John Kavanagh explores a significant recent decision from the Court of Appeal in the case of A Taxpayer v HMRC. The case considers how the Statutory Residence Test (SRT) deals with exceptional circumstances and when a taxpayer can be considered prevented from leaving the UK due to unforeseen personal events.

The facts involve a taxpayer who exceeded the permitted days in the UK after stepping in to care for her sister during a serious health crisis. The episode looks at how the First-tier Tribunal, Upper Tribunal, and Court of Appeal each approached the concept of exceptional circumstances, with the Court of Appeal ultimately recognising that compelling moral and family obligations can be just as restrictive as legal or physical barriers. Although John highlights in the podcast the possibility that HMRC might appeal the Court of Appeal's decision to the Supreme Court,he has since learned that HMRC have not lodged an appeal.

Whether you are a professional adviser, an internationally mobile individual, or simply interested in how UK tax residence is determined, this episode offers valuable insight into an evolving area of tax law.