Arriving in or Leaving the UK: Tax in the Year You Move

Why move years go wrong

A move year combines everything difficult in cross-border tax at once: residence changing mid-year, income earned in one country and paid in another, two tax years that do not line up (UK: 6 April to 5 April; US: calendar year), and deadlines in both. Most move-year problems trace back to one root cause — treating the move date as the tax answer, when the rules fix their own dates.

Arriving: when UK taxation actually starts

Your first UK question is what the Statutory Residence Test says about the whole tax year of arrival. If you are resident for that year, split-year treatment may divide it: a non-resident part, in which the UK broadly taxes only UK-source income, and a resident part, in which worldwide taxation begins. The split applies only if your facts fit one of the defined cases — arriving to take up your only home, starting full-time UK work, and others — and the split date follows from those rules, not from your arrival date.

Practical consequences worth planning around:

• Income timed before the split date — a bonus, a stock vest, a gain — may stay outside UK tax; the same item days later may be fully inside. For US persons it remains US-taxable either way, so the planning question is really about which country taxes it and at what net cost.
• New arrivers may qualify for the FIG regime, giving up to four years of relief on foreign income and gains — an election to model against the US return, not to claim by default.
• Registration comes fast. If you will need Self Assessment — foreign income, a split-year claim, self-employment — you must register by 5 October after your first UK tax year, and a UTR can take weeks to arrive.

Leaving: proving you have gone

Non-residence must be earned under the SRT: enough days out, ties reduced, and — for many leavers — the strict conditions of full-time work abroad. Common leaver housekeeping includes telling HMRC (form P85 for those outside Self Assessment; the residence pages of the return for those in it), sorting PAYE for a final payroll, applying under the Non-Resident Landlord Scheme if a UK property will be let, and keeping day-count and ties evidence for the years that follow.

Split-year treatment works for leavers too: where a case applies, worldwide UK taxation ends part-way through the year rather than at its end. But UK-source income — rent, some pensions, UK employment duties — generally stays taxable here even after you leave.

The temporary non-residence trap

The UK anticipates the obvious plan — leave, realise gains offshore, come back. Under the temporary non-residence rules, someone who has been UK resident, becomes non-resident for only a short period (broadly, five years or less), and then returns, finds that certain income and gains realised during the absence are taxed in the year of return. Capital gains on assets held before departure are the classic target, along with certain pension payments, dividends from close companies and other listed items.

The rules are detailed — sufficient prior residence, the length of absence, and what exactly is caught all matter — but the strategic point is simple: a short spell abroad does not launder pre-departure gains. Anyone leaving with plans to sell should test the timeline against these rules before relying on it.

The US overlay: dual-status and mismatched years

A transatlantic move also creates a US move year, and its shape depends on status. A US citizen or Green Card holder is taxable in the US all year regardless of the move; their move year is about foreign tax credits, the foreign earned income exclusion, and matching UK tax paid to the right US year. A non-US person moving to the US typically has a dual-status year — part non-resident, part resident — with its own rules and restrictions, while their UK year may be splitting in the opposite direction.

Because the UK split date and the US status-change date almost never coincide, there is usually a window where the two systems' claims overlap or gap. That window is where move-year returns are won or lost — see our detailed guides on moving to the UK and moving to the US.