Regional Updates

In periods of heightened uncertainty, it is natural for decisions to be guided by what feels right for family or immediate circumstances. Where travel patterns shift as a result, details like tax position or residency may not always be revisited straight away, even where the underlying position may have shifted without being recognised.

For many, these changes still feel temporary. In practice, even small shifts in where time is spent can have knock-on effects that are easy to miss.

“Where people tend to come unstuck is not the tax rules themselves, it’s assuming their situation hasn’t really changed,” says Tony Smith, Head of tax, technical and advice delivery, St. James's Place Asia & Middle East. “If you’ve spent more time in the UK than planned, even by a few weeks, that can start to affect how your position is viewed.”

At St. James’s Place, advisers are seeing more clients reviewing their position as travel patterns shift, particularly where financial arrangements span multiple countries.

When time abroad starts to matter

The UK tax system assesses residency year by year, based on what actually happened over that period.   To determine your UK tax residence status, you should refer to the Statutory Residence Test, which defines whether you are automatically non-UK resident, automatically UK resident, or, if neither applies, how your ties to the UK and your UK day count determine your status.

These factors can shift more easily than expected. A longer stay, a few additional workdays, or more frequent travel can change the overall picture, even if nothing feels materially different. For UAE-based expats, this is where assumptions tend to fall down. Living in the UAE does not automatically remove tax exposure elsewhere. Income may still be taxed where it is earned, and residency status can bring wider obligations.

The double taxation agreements between the UK and the UAE, helps prevent the same income being taxed twice, but they do not remove the need to determine residency correctly in the first place. In practice, the same issues tend to arise: miscounting days, assuming UAE residency overrides everything else, or making financial decisions without considering where you are resident at that point in time.

UK tax year-end: a useful checkpoint

For British expatriates, the end of the UK tax year on April 5 provides a clear moment to sense-check their position within this broader picture. Key allowances reset at this point, including the £20,000 ISA limit, which does not carry forward and is only available to UK residents, the capital gains tax exemption of £3,000, and pension contribution depending on individual circumstances. Residency is assessed for that specific tax year.

For those who have spent more time in the UK than expected, even briefly, this is a point to revisit whether their position still aligns with earlier assumptions.

With the 2024/25 tax year now ended, if your time in the UK has been different to what you expected, it’s worth using this point to identify any issues that may have arisen and understand how they affect your position.  Just as importantly, with the new tax year upon us, it would be prudent to look forward and plan for this year.

Periods of increased movement tend to expose gaps that would otherwise go unnoticed. Residency is assessed each year, not fixed, and even small changes in travel patterns can have wider implications than expected.

Reviewing your position

For expats splitting time between the UAE and the UK, even on a temporary basis, this is less about reacting to a deadline and more about making sure their position reflects how they have actually been living and working over the past year. Taking a moment to sense-check now can help bring clarity and avoid more complicated issues later.

“People often move between countries without fully understanding how the rules apply in the place they’re spending time,” adds Tony Smith. “That can affect how income is treated, how existing assets are viewed, and whether working there creates a tax exposure. In some cases, it can also affect where a business is considered to be managed and controlled. Having a clear view of that upfront, and planning around it, helps avoid issues building up over time.”

In practice, this is where skilled, licensed advice can make a difference. St. James’s Place Middle East is authorised and regulated by the Dubai Financial Services Authority, and works with clients to assess how changes in residency, income and assets may affect their position. Having that clarity early helps ensure any issues are identified and addressed before they become more complex.

To learn more about St. James's Place, had any questions from this article, or wanted to speak with a qualified adviser about your own financial planning, please visit: www.sjp.asia/ae 

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