Where am I domiciled?
Working out which country you are domiciled in can be complicated and there are many factors which need to be considered. There are three main types of domicile – domicile of origin, domicile of dependence and domicile of choice. You may also be ‘deemed UK domiciled’, irrespective of your actual domicile. We explain each of these below.
HM Revenue and Customs' (HMRC) booklet RDR1 contains useful flowcharts on domicile. You can find this guidance at section 5.24 of RDR1 on GOV.UK.
What is a domicile of origin?
You acquire a domicile of origin at birth. This is usually the same as the domicile of your father at that time, that is, the country that your father considered to be his permanent home at the date of your birth. As a result, your domicile may not be the country where you were born.
If your parents were not married when you were born, you will take your domicile from your mother. If you are adopted, you take your domicile from your adopted father – if there is no adopted father, you take the domicile from your adopted mother.
It is very difficult to displace your domicile of origin. Indeed, your domicile of origin is retained permanently, unless it is superseded by a domicile of dependence or a domicile of choice. Your domicile of origin also returns if you acquire a domicile of choice which then ceases but you have not yet made a new domicile of choice.
Most migrants to the UK are likely to have a domicile of origin outside the UK, meaning that they are not domiciled in the UK (this is known colloquially as ‘non-dom’). Unless you choose to remain in the UK permanently or indefinitely, and sever ties with your original country of domicile or origin, you will probably continue to be not domiciled in the UK. However, if you were originally born in the UK or if you remain in the UK for more than 15 years, then you will be deemed to be domiciled in the UK (see below).
What is a domicile of dependence?
Until you reach the age of 16, your domicile follows that of the person on whom you are legally dependent – if that person changes their domicile (through choice) then yours will also change.
What is a domicile of choice?
From the age of 16 (earlier in Scotland), an individual may be able to acquire a new domicile. This is called a domicile of choice. In order to acquire a domicile of choice, you must demonstrate the following:
- You have settled permanently in the country in which you now consider yourself domiciled;
- You must intend to stay there for the rest of your life;
- Generally, you must break your ties with the country of your domicile of origin. You do not necessarily have to become a UK citizen or passport holder but these factors will be taken into account.
You will have to prove that you have chosen to live in the new country on a permanent basis and provide strong evidence of your intention to stay there permanently or indefinitely.
Factors such as your intentions (for example, where you intend to retire), your Will, your permanent place of residence, and your business, social and family commitments will be taken into consideration when looking at whether you have acquired a domicile of choice.
In most cases it will be fairly obvious what your domicile status is, but it can be very complex in some cases. If a lot of tax is at stake, you should seek professional help. We tell you how you can find a professional tax adviser in our Getting Help section.
What is deemed domicile?
With effect from 6 April 2017, HMRC treat some individuals who are not UK domiciled as if they are domiciled in the UK for income tax and capital gains tax purposes.
This affects you if:
- you are domiciled outside the UK, but you were born in the UK with a UK domicile of origin; or
- you have been resident for tax purposes in the UK for at least 15 of the previous 20 tax years.
The effect of being UK resident in a tax year and deemed domiciled in the UK for income tax and capital gains tax purposes is that you are chargeable to UK tax on your worldwide income and gains on the arising basis in the same way as individuals who are actually UK resident and UK domiciled.
If you think this might apply to you, you should seek professional help. We tell you how you can find a professional tax adviser in our Getting Help section.
How do I tell HMRC what my domicile status is?
In the UK, you self-assess your residence and domicile status.
As with residence, there is no formal process for agreeing your domicile status with HMRC, however if you are someone who is required to submit a tax return, you will need to complete the SA109 ‘Residence, remittance basis etc.’ supplementary pages if your domicile status is relevant to the entries on your tax return (for example, if you are claiming the remittance basis and have left out your foreign income and gains on the basis that they have not been remitted). This is then subject to potential enquiry by HMRC if they wish to challenge the position you have taken. Note that it is not currently possible to file the SA109 pages online using HMRC’s own filing portal. You will therefore need to file on paper (before an earlier deadline) or using commercial software.