National Insurance for those abroad United Kingdom

Non-Residents: Frequently Asked Questions

These are guidelines only and the circumstances of each case may need to be considered.

National Insurance for those abroad

Q1: I’ve been in the UK working for less than 1 year; can I have a refund of my National Insurance contributions?

A1: All UK employees under Retirement Pension age are liable to Class 1 National Insurance Contributions if their earnings are above a certain level link: http://www.hmrc.gov.uk/rates/nic.htm  for that year.
If during that tax year your earnings were above the required level then you were liable to pay Class 1 National Insurance contributions. The contributions you have paid have, therefore been correctly deducted and there is no refund due.

Q2: How much UK Retirement Pension am I entitled to?

A2: If you are within 6 months of Retirement Pension age (or over Retirement Pension age) you need to contact the Department for Work and Pensions’ (DWP) International Pensions Centre on 0191 21 87777 if you are in the UK or 44 191 21 87777 if you are calling from overseas. You can also contact them at the following e-mail address TVP-IPV-Customer-Care@thepensionservice.gsi.gov.uk. Alternatively, you can visit the DWP website link: http://www.dwp.gov.uk/contact  for more information.
If you are abroad or planning to go abroad in the near future, and not within 4 months of Retirement Pension age, you can ask us for a Retirement Pension forecast. You can download the application form CA3638 (PDF 206K) link: http://www.hmrc.gov.uk/pdfs/ca3638.pdf  and send it to HMRC Residency link: http://www.hmrc.gov.uk/cnr/osc.htm  Newcastle. If you cannot download the form you can call HMRC Residency and ask them to send it to you. If you are in the UK please ring 0845 915 4811 or call 44 191 203 7010 if you are calling from overseas.

Q3: What class of voluntary National Insurance Contributions can I pay when abroad?

A3: There are various conditions that you have to satisfy before you can pay either voluntary Class 2 or 3 National Insurance Contributions. To see whether you satisfy the conditions for either Class 2 or 3 National Insurance Contributions please read pages 13 to 16 of leaflet NI38 (PDF 1.2MB) link: http://www.hmrc.gov.uk/pdfs/nico/ni38.pdf

Q4: How much are voluntary Class 2 and 3 National Insurance Contributions?

A4: You can get the rates of Class 2 and 3 National Insurance Contributions here link: http://www.hmrc.gov.uk/rates/nic.htm

Q5: How can I pay my National Insurance contributions?

A5: There are various methods of payment available. To see which method suits you please read pages 16 to 18 in the leaflet NI38 (PDF 1.2MB) link” http://www.hmrc.gov.uk/pdfs/nico/ni38.pdf

Q6: What benefits do I get from paying my National Insurance Contributions?

A6: To see what benefits you are entitled to please read page 10 of leaflet NI38 (PDF 1.2MB) link: http://www.hmrc.gov.uk/pdfs/nico/ni38.pdf

Q7: I am going abroad and would like to know more information about National Insurance Contributions. What do I need to know or read?

A7: Your National Insurance position depends on the circumstances of your departure from the UK and the country where you are going. To learn more about your National Insurance position while you are abroad please visit HMRC Residency link: http://www.hmrc.gov.uk/cnr/osc.htm  and pages link: http://www.hmrc.gov.uk/cnr/index.htm  

Q8: Do I need to pay voluntary National Insurance Contributions while abroad?

A8: There have been important changes to the State Pension so before deciding whether or not to pay voluntary National Insurance Contributions we recommend that you visit the following website address for more information www.dwp.gov.uk/pensionsreform. If after visiting this website you still wish to pay voluntary National Insurance Contributions you can do so via leaflet NI38 (PDF 1.2MB) link: http://www.hmrc.gov.uk/pdfs/nico/ni38.pdf .

Non-Residents: Liability to Tax in the United Kingdom

Q1: How can I claim repayment upon leaving the UK? (For temporary visitors to the UK only)

A1: To enable HMRC to consider any income tax repayment that may be due to you please complete form P85 link: http://www.hmrc.gov.uk/cnr/p85_p85s.htm .
Please send the completed form, together with parts 2 and 3 of your P45 certificate of pay and tax (provided by your former UK employer) to the tax office dealing with your UK tax affairs.
If you were employed in the UK for only part of the last tax year, and were still on emergency code at 5 April, you may have overpaid tax for the earlier year too. Your employer should have given you a form P60 showing your pay and tax paid. Emergency code is indicated by the symbols ‘W1’, ‘M1’ or ‘X’ after the tax code. We do not provide any special claim form. Simply ask your UK tax office link: http://www.hmrc.gov.uk/local/individuals/index.htm  to make a refund for that year too. 

Q2. When I go to live or work abroad, will I continue to pay UK tax?

A2. If you remain treated as resident in the UK for UK tax purposes, normally you will be taxable on your income arising in the UK and overseas. If you are treated as resident and pay tax outside the UK we can give appropriate credit for any tax paid abroad.
If you become treated as non-resident, you will normally only be taxable on your income arising in the UK. 
Q3. In what circumstances would I become non-resident?
A3. Normally if you leave the UK to work abroad full-time, you will become not resident and not ordinarily resident in the UK if

• your absence and employment from the UK covers a complete tax year (i.e. 6 April to 
  5 April), and
• you spend less than 183 days in the UK during the tax year, and
• your visits to the UK do not average 91 days or more a tax year over a maximum of 4 years.

For visits to the UK, days of arrival and departure are not normally counted as days spent in the UK.

Q4. Can I choose to pay tax in the UK rather than in my country of residence?

A4. No. If a double taxation treaty is involved, the country in which you pay tax will be determined as a matter of fact and not choice. More information on Double Taxation Treaties link: http://www.hmrc.gov.uk/cnr/app_dtt.htm

Q5. Will I have to pay tax in the country to which I go to live or work?

A5 The country to which you go to live or work may tax you on your world-wide income. This will depend on its own laws. You may need to ask the tax authority there for advice. More information on Double Taxation Treaties link: http://www.hmrc.gov.uk/cnr/app_dtt.htm

Q6: Why am I paying tax in the UK on my income when I am no longer resident there?

A6. Income arising in the United Kingdom will remain liable to United Kingdom income tax. However, depending on your nationality and where you live you may be eligible to:-

1.   make a claim for repayment of United Kingdom Income Tax. More information on Double Taxation Treaties link: http://www.hmrc.gov.uk/cnr/app_dtt.htm 

2.   make an application for exemption from United Kingdom Income Tax. More information on Double Taxation Treaties link: http://www.hmrc.gov.uk/cnr/app_dtt.htm

3.   use any personal allowances to which you may be entitled to offset some or all of your tax liability. More information on Personal Allowances link: http://www.hmrc.gov.uk/cnr/allow_nonres.htm

Q7. I have a bank/building society account in the UK. Will tax still be deducted from interest if I am non-resident in the UK and can I claim repayment?

A7: From 6 April 1996, where you are treated as not resident for the whole tax year, the liability to tax on interest from a UK bank or building society is limited to the tax deducted at source, if any. However, this is provided that the account is not held in connection with a trade, profession or vocation carried out through a branch or agency in the UK.
If you are not ordinarily resident in the UK, you can apply to receive future interest without deduction of tax by providing your bank with a ‘not ordinarily resident declaration’ on form R105 link: http://www.hmrc.gov.uk/nonresidents/fagr105.shtml . However, please note that not all banks choose to offer the facility of gross interest to non-residents, so please check with your bank first.
If you would like to make a repayment claim for tax already deducted, certain non-resident individuals can claim the UK personal allowance link: http://www.hmrc.gov.uk/cnr/allow_nonres.htm   against income liable to UK income tax. If you wish to pursue such a claim, the relevant claim form R43 link: http://www.hmrc.gov.uk/cnr/allow_nonres.htm#g  is available.
If you do not wish to claim personal allowances, or your personal allowances are used against other sources of UK income, then you may be due tax relief under the terms of any Double Taxation Agreement link: http://www.hmrc.gov.uk/cnr/app_dtt.htm  between the UK and your country of residence. 

Q8. If I live abroad and receive a pension from my former employer. How will this be treated for UK tax purposes?

A8 If you have recently left or are about to leave the UK please remember to complete form P85 and return it to the tax office link: http://www.hmrc.gov.uk/local/individuals/index.htm  dealing with your UK tax affairs. 

In general, income arising from sources within the UK to a non-resident individual remains liable to UK tax. However, you may be due tax relief under the terms of any Double Taxation Agreement link: http://www.hmrc.gov.uk/cnr/app_dtt.htm  between the UK and your country of residence.
You can view or print a Double Taxation Digest (PDF 204K) link: http://www.hmrc.gov.uk/cnr/dtdigest.pdf  which is a summary of the main parts of all our Agreements. In some cases such relief is not available if it is for a pension paid in respect of a former Government or Local Government service.
If you wish to pursue a claim, you can download a variety of claim forms link: http://www.hmrc.gov.uk/cnr/app_dtt.htm

If you would like to make a repayment claim for tax already deducted, certain non-resident individuals can claim the UK personal allowance link: http://www.hmrc.gov.uk/cnr/allow_nonres.htm  against income liable to UK income tax. If you wish to pursue such a claim, the relevant claim form R43 link: http://www.hmrc.gov.uk/cnr/allow_nonres.htm#g   is available.

Q9. I am not resident in the UK and I have been paying tax on my annuity. Is this correct?

A9. Please see our separate list of FAQ’s about Retirement Annuities paid to Non-Residents link: http://www.hmrc.gov.uk/cnr/rac-faqs-non-res.htm

Q10. What happens if I let my UK home/property whilst I am living or working abroad?

A10. Letting agents, or certain tenants if there is no letting agent, must deduct basic rate income tax from the UK rental income if the landlord has a usual place of abode outside the UK. However, landlords have the option of applying for approval to receive their UK rental income with no income tax deducted by simply completing form NRL1 (PDF 205K) link: http://www.hmrc.gov.uk/cnr/nrl1.pdf

The granting of approval does not grant exemption from UK income tax; any tax liability will be dealt with under Self-Assessment link: http://www.hmrc.gov.uk/cnr/self_assess.htm

If the rental income is also charged to tax in your country of residence, then that country should give the relevant Tax Credit for the UK tax paid.
If you are not in Self-Assessment, you have paid tax and want to claim a repayment, please complete and send us form R43 link: http://www.hmrc.gov.uk/cnr/allow_nonres.htm#r43

If your rent is received gross and you did not receive a Self-Assessment return, the tax return is not necessary if no tax liability arises.
If you jointly own the property, the income is usually shared equally; owners are individually responsible for any UK tax liability arising from their share of that income. 
Therefore, each owner has to complete form NRL1 (PDF 205K) link: http://www.hmrc.gov.uk/cnr/nrl1.pdf   make a claim for repayment and complete a tax return in respect of your own share.
Further information about the Non-Resident Landlord Scheme link: http://www.hmrc.gov.uk/cnr/nr_landlords.htm  is available. 

Q11. What is the time limit for making a claim to repayment of UK tax?

A11: If you want to make a claim for any tax year there is a time limit within which you must do so. Each tax year ends on 5 April. For any particular tax year you have up to the next 31 January and the following 5 years to make a claim. For example, a claim for the tax year ended 5 April 2001 must be made by 31 January 2007.
Provided we are notified of the Intention to Claim (Notice of Intent) by the relevant date, we will consider a claim received after that date provided it is received without undue delay. 

Q12: What do I need to do, as I am coming to live or work in the UK?

A12: If you have a Tax Office in the UK, ask them for a form P86. If you do not know which Tax Office deals with your tax, ask for advice from any Tax Office link: http://www.hmrc.gov.uk/menus/contactus.shtml   or HMRC Enquiry Centre.
You may also find our Helpsheet for Migrant Workers link: http://www.hmrc.gov.uk/cnr/helpsheet_download_page.htm   useful.

Q13: In what circumstances will I be treated as a UK resident for UK tax purposes?

A13: To be treated as resident in the UK you must normally be physically present in the country at some time in the tax year. You will always be treated as resident if you are here for 183 days or more in the tax year. There are no exceptions to this. You count the total number of days you spend in the UK - it does not matter if you come and go several times during the year or if you are here for one stay of 183 days or more. If you are here for less than 183 days, you may still be treated as resident for the year if you visit the United Kingdom regularly and your visits average 91 days or more a tax year over a period not exceeding 4 years.
The normal rule is that days of arrival in and departure from the UK are ignored in counting the days spent in the UK.

Q14: I am not resident in the United Kingdom so why do I need to complete a Self Assessment return?

A14: Please see our separate list of FAQ’s about Self-Assessment for non-residents link: http://www.hmrc.gov.uk/cnr/faqs_sa.htm

Q15: Can I be resident in two countries at the same time?

A15: It is possible to be resident in both the UK and some other country (or countries) at the same time. Where, however, you are resident both in the UK and a country with which the UK has a Double Taxation Agreement link: http://www.hmrc.gov.uk/cnr/app_dtt.htm   there may be special provisions in the agreement for treating you as a resident of only one of the countries for the purposes of the agreement.
Form IR302 (PDF 62K) link: http://www.hmrc.gov.uk/pdfs/2002_03/non_res_etc/ir302.pdf   gives you information to help you decide whether you are resident of the UK or another country for the purposes of applying the provisions of the Double Taxation Agreement between the UK and that country. 

Q16: What is Split Year Treatment?

A16: You are either resident or not resident in the UK for the whole of a tax year. However, by concession, the tax year is split in certain circumstances when you come to, or leave, the UK part way through a tax year. Where this applies, your tax liabilities on income which are affected by tax residence will be calculated on the basis of the period of your actual residence here during the year. This has the same effect as splitting the tax year into resident and not resident periods.
The notes that accompany the Non-Residence Self-Assessment link: http://www.hmrc.gov.uk/sa/forms/content.htm  supplementary page will help you determine whether you qualify for Split Year Treatment.

Q17: What is Domicile?

A17: Domicile is a concept of general law. It is used to determine the system of personal law (dealing with matters such as marriage, divorce and wills) that should be applied to an individual who has connections with more than one jurisdiction. Domicile is distinct from nationality or residence. You can only have one operative domicile at any given time.
HMRC Residency provides specialist advice to other tax offices on the domicile of individuals where it is material to the calculation of the individual's UK income tax or capital gains tax liabilities.
You should contact your own Tax Office link: http://www.hmrc.gov.uk/local/index.htm  if you have any queries on your domicile position.