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HMRC v Glyn: upper tribunal finds that wrong residence test was applied

HMRC v Glyn: upper tribunal finds that wrong residence test was applied

In the recent case of HMRC v Glyn UKUT 0551 (TCC) it was found that a First-tier Tribunal applied the wrong test when determining the residence of a taxpayer. Although the individual had a family home in the UK, and visited frequently, it was held that the lower tribunal had applied the wrong test in establishing that there had been a significant break from the UK. The Upper Tribunal found that the lower tribunal had:

  • Misapplied the notion of settled purpose to determine whether the individual had had a distinct break from the UK, and resided the UK family home was a habitual or settled residency.

  • Concentrated primarily upon the reasons why the taxpayer had kept the UK property, rather than its use.

  • Incorrectly found that the main reason for keeping the UK property was so that the individual could live there again in the future.

  • Followed the case of the Supreme Courts decision in R (Gaines-Cooper) v HMRC UKSC 47 and taken HMRCs IR20 guidance into account to determine whether a taxpayer was a non-UK resident on the basis of common law tests.

The tribunal has remitted the case to the lower tribunal for a re-hearing. The judgment can be read in full here.

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