Studying in the UK

The statutory residence test

As an international student, if you have taxable income from overseas then you need to work out your residence position under the statutory residence test (SRT) so that you know if you might need to pay tax on that income in the UK.

However, note that:

1. Students may have income from sources other than employment or investments, such as scholarship or grant income, which may be exempt from UK tax. There are also special international rules which can apply if your overseas employer is sponsoring you during your training or if you receive certain payments from sources outside the UK for maintenance, education and training. See UK tax for international students in the UK for more information.
2. If you are entitled to a UK personal allowance (for example, if you are an EEA citizen or UK national) and your worldwide income in a particular UK tax year (6 April to 5 April) does not that allowance (for 2024/25, this is £12,570), you will have no UK tax to pay for that year, irrespective of your residence status.

If you spend fewer than 183 days in the UK during that tax year, working through the SRT if you are an overseas student studying in the UK can be difficult. This is partly because the academic year (usually from September to July) is not aligned with the tax year (from 6 April to 5 April), but also because the SRT is focussed around where you have a ‘home’ and whether you carry out full-time work in the UK or overseas.

Students are very unlikely to meet the tests for full-time work in the UK or overseas while they are studying, even if they carry out full-time work for a few weeks outside of term time. This is because in order to be considered to be carrying out full-time work in the UK or overseas under the SRT, you must do so over a much longer period (generally a year).

Furthermore, given that students normally have a ‘home’ in their home country and a term-time residence in the UK, it can be unclear where a student should consider that they have a ‘home’ for the purpose of the SRT.

Where the tests which consider a taxpayer’s home (or in some cases, homes) and full-time work are not met, it is normally necessary to consider what ‘ties’ that taxpayer has to the UK and compare this with the number of days spent in the UK. This can be a fiddly and detailed assessment.

In order to assist you, we set out below a detailed case study of how the SRT might work for Jan, a student from Germany studying in the UK. It is important to bear in mind that each situation is unique, and you should take advice if you are in doubt. The case study below is given for illustrative purposes only.

A case study: Jan

Jan is from Germany and is a postgraduate at the Royal College of Music in London. Prior to this he was a full-time student in Germany, being supported by his parents. For the first year of his 2-year course, starting in September 2024, he spends term time in the UK and other times of the year in Germany.

Jan works full-time in his uncle’s bar during the holidays when he is in Germany. In addition, he earns money in the UK on a self-employed basis, as a professional singer. He has not previously been tax resident in the UK or spent any significant time in the UK. He is single and has no children.

In 2024/25, he earns £7,000 from his bar work in Germany (including tips) and £8,000 in the UK from performance fees.

Part 1

Jan spends the following number of days in the UK during the 2024/25 academic year:

For SRT purposes, we need to count the number of days on which the taxpayer is present at midnight at the end of the day (subject to certain exceptions). In assessing your own residence status, you should ensure you count the days accurately.

Jan spends a total of 157 days (82 + 75) in the UK during the 2024/25 tax year.

Working through the statutory residence test for 2024/25, none of the applicable automatic overseas tests are met:

Jan is therefore not automatically non-resident in the UK. Now we need to consider whether any of the automatic UK tests are met:

We now need to consider the second automatic UK test in more detail. The conditions for the test can be difficult to fully understand, but broadly it is asking if Jan has his ‘only home’ in the UK.

‘Homes’ under the statutory residence test

The law defines a ‘home’ for this purpose as any building or structure which the individual uses with a ‘degree of permanence or stability’. It does not include holiday homes or similar properties which are used for temporary purposes, and it does not need to be a property the individual owns. It is possible to have two or more ‘homes’ or even no home at all.

The required ‘degree of permanence and stability’ may be established over a relatively short timescale and does not require that the individual expects to remain in that accommodation permanently.

HMRC publish a list of factors which might be considered when trying to work out whether or not somewhere counts as a ‘home’. However, it will depend on the full facts and circumstances of the case.

If a student has accommodation provided in halls of residence, strictly for the duration of term time and this is not available outside of term time (let’s say the room is used by the university for conference accommodation or other events), it could be argued that their term-time accommodation is not used with the required degree of permanence and stability to count as a home.

On the other hand, if a student lives in private rented accommodation (say in their second and subsequent years) which is available permanently throughout the academic year, then it becomes more likely that this will be treated as a ‘home’ in the UK.

Jan establishes that his UK accommodation is not available outside of term-time and concludes based on all the facts and circumstances that he does not have a ‘home’ in the UK. As such, he does not need to consider the test further.

For students, it can be easier to consider first whether or not you have a home overseas before considering whether you have a home in the UK. If you continue to have a home overseas throughout the tax year and you are present at that home for at least 30 days in the tax year, you cannot meet the second automatic UK test. In Jan’s case, this would have been an alternative way to establish that he did not meet this test.

Jan is not automatically UK resident for 2024/25. However, he may be resident in the UK if he meets the sufficient ties test. This considers the number of days spent in the UK against the number of ‘ties’ an individual has to the UK. The greater the number of days spent in the UK, the fewer the number of ‘ties’ required to trigger residence. Let’s apply the test to Jan.

Knowing that Jan spends a total of 157 days in the UK during 2024/25, by looking at the appropriate table, we know that just two ties to the UK will be ‘sufficient’ to make him resident in the UK for that year. The potential ties are:

Here we can see that Jan only has one tie. But he needs at least two to become resident in the UK under this test, so we can conclude that the sufficient ties test is not met.

As a result, he concludes that he is non-resident in the UK for 2024/25.

This means that he does not need to worry about his German income being taxed in the UK.

If Jan had been resident in the UK under the statutory residence test, and he also remained resident in Germany under German tax law, his next step would be to look at the double tax agreement between UK and Germany to see in which country he is considered ‘most’ resident for the purposes of the agreement.

The ‘tie breaker’ provisions of the double tax agreement will determine where Jan is ‘most’ resident.

This can sometimes be an easier assessment. For example, it might be that Jan is ‘treaty-resident’ in Germany for the purpose of the agreement even if he is resident in the UK under the SRT. If he is, then the double tax agreement says that his German employment income should only be taxed in Germany, essentially giving the same result as being non-resident under the SRT. However, strictly speaking this requires a formal claim under the double tax agreement, which would normally be submitted as part of a self assessment tax return.

Even though Jan is non-resident under the SRT (and/or treated as non-resident for the purposes of the double tax agreement), he will still be taxable in the UK on his UK-sourced income.

As regards his performance fees, these are treated as UK self-employment income. Jan should register to file a self assessment tax return in order to declare the income, although there will be no tax to pay (because the £8,000 income will be within his UK personal allowance for the year of £12,570).

Jan should also check whether or not his UK performance fees are within scope of German tax.

Part 2

In the 2025/26 academic year, Jan rents a private house with some friends from 1 September 2025. He continues to return to Germany during holidays and continues his bar work there.

In the 2025/26 tax year, he earns the same amount from his bar work (£7,000) but manages to earn £10,000 in performance fees.

In the 2025/26 tax year, he spends the following days in the UK:

Here, we can see immediately that Jan will be resident in the UK for the 2025/26 tax year, because he spends more than 183 days in the UK.

The consequence of this is that his worldwide income will be potentially within scope of UK tax for the 2025/26 tax year. However, if Jan remains resident (and is treaty resident) in Germany, his German bar income should be only taxable in Germany under the double tax agreement. The double tax agreement effectively overrides the UK position under domestic law.

Jan should also check whether or not his UK performance fees are within scope of German tax.

It is worth noting that an individual is usually either UK resident or non-UK resident for a full tax year. While there are rules that allow you to split the tax year when you are coming to the UK (into effectively a non-resident part and a resident part, which restricts the UK’s ability to tax your ‘pre-arrival’ income), in practice the opportunities to do so are limited for students.

In any case, as we have explained, for Jan, it should be possible for him to make a claim under the double taxation agreement to restrict the UK’s ability to tax his German income (including any ‘pre-arrival’ German income from the period 6 April to his arrival for the summer term). In effect, this secures the same result as split year treatment, but just in a different way.

Even if a student is tax resident in the UK, they may escape UK tax on foreign income and gains (that are not exempt from UK tax under a double tax treaty) by virtue of their non-domicile status and the remittance basis for tax years up to and including 2024/25. This applies automatically where they have unremitted foreign income and gains of less than £2,000 for the year. ‘Unremitted’ means that the income is not brought to the UK or used or enjoyed in the UK. Alternatively, students who work in the UK and have a small amount of foreign employment income may qualify for an exemption on their foreign income if certain conditions are met (see our guidance on the Foreign workers' exemption).