Bank wants to know where i'm Tax Resident

lloydforth

My bank just wrote to me asking me to fill out a form asking me to declare where i'm tax resident. i'm unsure because my case is fairly unique due to modern technology.

I moved to Norway July 2015
I have a small Ltd business in the Uk ( 2 employees )
I travel to the Uk on average once a month for 2-3 days
I am an Employee / Director of the UK Ltd business entity.
I work from home in Norway everyday but via remote access into Uk based computer systems.

It seems automatic UK Tax residency is granted if i spend 183 days a year on UK soil, but if I'm under this amount the rules seem pretty vague and all over the place - i'd prefer to stay UK tax resident as it keeps things simple - its not a big business so additional expenses of tax declarations in both countries would be preferred

jennifernil

From the UK/Norway tax treaty, may help? There is a lot more of it too!



Resident
1. For the purposes of this Convention, the term “resident of a Contracting State” means any person who, under the laws of that State, is liable to tax therein by reason of his domicile, residence, place of management, place of incorporation or any other criterion of a similar nature, and also includes that State and any political subdivision or local authority thereof. This term, however, does not include any person who is liable to tax in that State in respect only of income or capital gains from sources in that State.
2. The term “resident of a Contracting State” includes:
a) a pension scheme established in that State; and
b) an organisation that is established and is operated exclusively for religious, charitable, scientific, cultural, or educational purposes (or for more than one of those purposes) and that is a resident of that State according to its laws, notwithstanding thyat all or part of its income or gains may be exempt from tax under the domestic law of that State.
3. Where by reason of the provisions of paragraph 1 an individual is a resident of both Contracting States, then his status shall be determined as follows:
a) he shall be deemed to be a resident only of the State in which he has a permanent home available to him; if he has a permanent home available to him in both States, he shall be deemed to be a resident only of the State with which his personal and economic relations are closer (centre of vital interests);
b) if the State in which he has his centre of vital interests cannot be determined, or if he does not have a permanent home available to him in either State, he shall be deemed to be a resident only of the State in which he has an habitual abode;
c) if he has an habitual abode in both States or in neither of them, he shall be deemed to be a resident only of the State of which he is a national;
d) if he is a national of both States or of neither of them, the competent authorities of the Contracting States shall settle the question by mutual agreement.
4. Where by reason of the provisions of paragraph 1 a person other than an individual is a resident of both Contracting States, then the competent authorities of the Contracting States shall endeavour to determine by mutual agreement the Contracting State of which that person shall be deemed to be a resident for the purposes of this Convention. In the absence of a mutual agreement by the competent authorities of the Contracting States, the person shall not be considered a resident of either Contracting State for the purposes of claiming any benefits provided by the Convention, except those provided by Articles 25, 26 and 27.

jennifernil

Where do you pay tax to?

laticsforlife

Well it's a UK Ltd Company, so it will pay UK tax, and your salary will be UK income (and any PAYE deducted on that).

That's the easy bit, where you are tax resident is, as you say, less clear.

On the whole 183 days part, that's easy enough to work out, but the whole are you UK Domiciled, Resident or non-resident, it's an awful subject.

If you do want to keep it simple, then say you are UK resident, and therefore all taxes will be in one place, then if Norway come knocking, you can show your UK status and tax returns etc.