Tax When You Leave the UK

When you leave the UK to live or work abroad, you need to inform HMRC to ensure you pay the right amount of tax and claim back any overpaid tax. Depending on when you leave and your circumstances, you may stop being a UK tax resident either immediately or partway through the tax year. Even after you leave, you may still have UK tax obligations if you continue to receive UK income.

Who needs to tell HMRC

You must notify HMRC if you're:

• Leaving the UK to live abroad permanently
• Going to work abroad full-time for at least one full tax year (including for a UK-based employer)
• A foreign national leaving the UK

The tax year runs from 6 April to 5 April the following year. You don't need to tell HMRC if you're simply leaving for holidays or business trips.

Telling HMRC means they can work out if you're due a tax refund, advise whether you need to pay tax in more than one country, and ensure you pay the right amount of tax on any UK pension you receive if you retire abroad.

How to notify HMRC using form P85

If you don't usually complete a Self Assessment tax return, you need to fill in form P85. You can claim online or by post to tell HMRC you've left or are leaving the UK and want to claim back tax from your UK employment.

Who can use form P85:

• You lived and worked in the UK
• You've left the UK and may not be coming back
• You work abroad full-time for at least one full tax year

Before you start, check your P45 for 'details of employee leaving work' — you'll need this information when you claim. You should also tell HMRC if you have a home in the UK, work full-time outside the UK, have salary still paid in the UK, or will spend time in the UK over the next three years.

Claiming online:

You'll need to sign in to the online service. If you don't already have sign in details, you can create them. However, if you haven't left the UK yet, you must print and post your claim instead. When you claim online, you'll receive a reference number that you can use to track your claim's progress.

Claiming by post:

You need to claim by post if you haven't left the UK yet or don't wish to use the online service. Get all your information together before you start, as you'll fill the form in online and cannot save your progress. Once completed, print and post it to:

Pay As You Earn

HM Revenue and Customs

BX9 1AS

Include your P45 if you have it. If not, explain why (for example, you may be retired or a UK crown servant employed abroad).

If you complete Self Assessment tax returns

You don't need to fill in form P85 if you're sending a Self Assessment tax return for the tax year that you leave the UK. Instead, tell HMRC you're leaving through your Self Assessment tax return by completing the 'residence' section (form SA109) and sending it by post. You cannot use HMRC's online services to tell them you're leaving the UK.

The deadline is 31 October if you send your return by post. You'll be charged a penalty if you miss this deadline. You can also complete your Self Assessment tax return using commercial software or with help from a professional such as an accountant.

If you're going to work full-time for a UK-based employer for at least one full tax year, you should still fill in form P85 in addition to your Self Assessment tax return and form SA109.

Tax refunds

If you're due a repayment, HMRC will pay you or someone else on your behalf (known as your 'nominee'). They'll post a payable order to your address or your nominee's address, to be paid into a bank account held in your or your nominee's name.

HMRC will only send a cheque within the UK. HMRC will not pay any fees to convert your repayment into another currency or to transfer it abroad. You may want to keep your UK bank account open until you receive the repayment to avoid any fees.

Non-resident status and split year treatment

If you're non-resident, you don't pay UK tax on income or gains you get outside the UK. You may become non-resident the day after you leave the UK — this depends on your situation and how 'split year treatment' applies to you.

Split year treatment is a tax rule that can divide the tax year into a UK resident part and a non-resident part, rather than treating you as resident or non-resident for the entire year. This can affect when you stop being liable for UK tax on your worldwide income.

Ongoing UK tax obligations

You may need to pay UK tax even when you're non-resident if you have UK income. For example, you could be taxed if you have income from renting out a property in the UK.

The UK has double taxation agreements with many countries to make sure you don't pay tax twice on the same income.

Visiting the UK after you leave

You can visit the UK without becoming resident again, depending on why you visit and how long you visit for. If you work full-time abroad, you can usually visit the UK for up to 90 days, as long as you work no more than 30 of these days.

You might become a UK resident again if you start new activities in the UK after you've left, such as getting involved in a business or buying a new property.

If you miss a payment or can't pay

Contact HMRC as soon as possible if you've missed a tax deadline or know you won't be able to pay a tax bill on time. HMRC will always try to contact you if you miss a tax payment.

If you don't contact HMRC and don't pay, HMRC will ask the tax authority in the country you're living in to collect the tax from you on their behalf.

National Insurance

You can't claim back any National Insurance you've paid in the UK if you leave permanently. However, anything you've paid might count towards benefits in the country you're moving to if it's one of the countries that has a social security agreement with the UK.

You might be able to pay National Insurance while you're abroad if you're planning to come back to the UK or claim the State Pension later.

Changes to your circumstances

You need to contact HMRC if your circumstances change when you're abroad (for example, you move house or your marital status changes). You'll need your National Insurance number. You also need to tell HMRC if you come back to live in the UK.

Sources

• Get your Income Tax right if you're leaving the UK (P85)
• Tax if you leave the UK to live abroad

This article provides general guidance based on current HMRC rules. For advice specific to your situation, speak to your accountant.