Where an individual is resident in the UK and has overseas income and/or gains, it may be possible to claim tax relief or exemption to avoid paying tax twice. For some countries, it is necessary to provide their tax authorities with a ‘certificate of residence’ confirming UK residence status.
In this guide, we’ll explain everything you need to know about applying for a certificate of residence in the UK, so you don’t have to pay tax twice on your income.
Who is eligible for a certificate of residence?
You are eligible to apply for a certificate of residence if:
- you’re classed as a UK resident
- there’s a tax treaty with the country concerned
The overseas authority dealing with your claim will normally ask HMRC to certify that you’re a resident of the UK. They will then decide if you will be given relief from foreign taxes, in line with the double taxation agreement between the two countries.
How to apply for a certificate of residence to claim tax relief abroad
There are multiple ways to apply for your certificate of residence, with different processes depending on who’s applying.
Individuals and sole traders
There are two options to apply for a certificate of residence as an individual. You can use the Government’s online service, where you’ll need to create or use your Government Gateway ID to log in.
Alternatively, you can email a form using the online platform. For this option, you won’t need to create or log in to your Government Gateway account.
In some cases, the other country may give you a form to certify residence. If this applies to you, you can send the form to the below address so it can be completed:
Pay As You Earn and Self-Assessment
HM Revenue and Customs
BX9 1AS
Companies
If you are a company that has the Large Business Service deals with tax affairs, you can use the RES1 online service to request a certificate of residence.
For companies that have Local Compliance deal with their tax affairs, requests should be sent using the RES1 online service.
Where a foreign tax authority has provided a physical document that needs to be completed by HMRC, these can be posted to:
Corporation Tax Services
HM Revenue and Customs
BX9 1AX
United Kingdom
Partnerships (including Lloyd’s syndicates)
Again, you can use the RES1 online service to request a certificate of residence.
If your partnership has a Customer Compliance Manager or Customer Coordinator in Large Business, then your certificate of residence request should be sent to them.
Alternatively, you can send requests by post to:
Pay As You Earn and Self-Assessment
HM Revenue and Customs
BX9 1AS
What information does HMRC need to claim your certificate of residence?
HMRC will request the following information on your certificate of residence application:
- why you need a certificate of residence – i.e. you are receiving income in the UK and also abroad
- the double taxation agreement for the country you want to make the claim under
- the type of income you want to make the claim for – i.e. wages, pensions, property dividends, etc.
- the period you’re applying for the certificate of residence, if it’s different from the date of issue
- confirmation of your travel pattern (eg. number of days spent in the UK in the tax year) or other proof of you meeting the
Some double taxation agreements will also need confirmation that you are the beneficial owner of the income you’re claiming for, and proof you are subject to tax in the UK for all the income you’re claiming for.
What to do if you’ve paid tax in two countries
If you’re concerned that you’ve already paid the double tax, you may be able to apply to get a refund to get all or some of the tax back. When you fill out your tax return, you can report the income you have earned overseas and claim for Foreign Tax Credit Relief.
How much refund you will be entitled to will depend on the country’s double taxation agreement with the UK. However, you may still be eligible for some relief, even if there is not an agreement.
Contact Abbiss Cadres for Global Mobility Services
For further information or to discuss the issues raised in this guide, please contact the Abbiss Cadres tax team by email or on +44 20 3051 5711.