UK tax considerations for returning Middle East expats

With the rapid changing environment in the Middle East, people will quite rightly be considering whether they should stay in the region whilst the landscape changes.

From the UK we have seen that holiday makers and expats are looking to return to the UK. Whilst there are more important factors, some people who have emigrated to this region may be considering the UK tax implications of returning to the UK. It is important to note, that the residency tests in the UK have some built in flexibility should they need to be used. 

There are a number of factors to consider, from tax liabilities on worldwide income during the year of tax residency to the temporary non-UK resident anti-avoidance rules for taxpayers who have been non-UK tax resident for fewer than 5 years. 

As a reminder for taxpayers, within the Statutory Residence Test there are a number of factors that determine residency and people may be able to spend substantial time in the UK without becoming UK tax resident.  

A key component will be the day counting rules, and what qualifies as a day in the UK. Taxpayers should seek guidance on how long they can spend in the UK without being tax resident in the current tax year ended 5 April 2026 and the subsequent one to 5 April 2027.  This will vary depending on the number of ties to the UK, including how recently they were UK resident for tax purposes. 

Those who were visiting the UK during this period may not have been able to return whilst flights have been cancelled. They should seek guidance on the application of the circumstances rules, where those days are not counted for the purposes of the Statutory Residence Test. 

For those returning to the UK for a brief period the government may respond to the circumstances with exceptional rules in the circumstances. They provided clarity for both the war in Ukraine and COVID-19, and they may react accordingly to these specific circumstances. However, taxpayers cannot rely on this and any consideration may be after the fact. Being aware of the rules will be an important part of family planning if they need to lease the Middle East for a period of time. 

We are very happy to guide taxpayers in this area and if you would like a consultation please to contact the author.