SearchHarry and Meghan’s reported UK return: could tax timing be part of the picture?
Reports that the Duke and Duchess of Sussex are planning to return to the UK with their children have inevitably generated plenty of headlines.
According to media reports, the family intends to spend an extended period in the UK from autumn 2026, while retaining their home in California. However, representatives for the couple have declined to comment publicly on the reports.
While much of the discussion has focused on family relationships and royal duties, our Private Client Tax Partner, Karen Chadwick, had a rather different instinctive reaction: she began counting tax years.
The couple left the UK in March 2020. Counting forward gives us:
- 2020/21
- 2021/22
- 2022/23
- 2023/24
- 2024/25
- 2025/26
That amounts to six complete UK tax years before a possible return during 2026/27.
Why does the length of an absence from the UK matter?
The UK has temporary non-residence rules designed to prevent somebody from becoming non-UK resident for a relatively short period, realising certain income or gains while abroad and then returning without a UK tax charge.
Broadly, where the relevant conditions are met and the period of non-residence does not exceed five years, certain income and gains arising during that period can be treated as arising in the tax year in which UK residence resumes.
The provisions are anti-avoidance rules, but they do not bring every pound earned overseas during an absence into charge. They apply to specified categories of income and gains and contain numerous detailed conditions and exceptions.
HMRC guidance states that an individual who ceased to be UK resident in 2019/20 or earlier and did not resume UK residence until 2025/26 would fall outside the temporary non-residence rules. On that basis, somebody who ceased UK residence in 2019/20 and remained non-resident throughout the following six complete tax years would ordinarily be beyond the relevant five-year period on becoming resident again in 2026/27.
That does not tell us anything conclusive about the Duke and Duchess’s position. We do not know their UK residence status for each tax year, the nature or timing of their income and gains, how their commercial arrangements have been structured or what professional advice they have received.
We should certainly not assume that tax drove either their original departure or their reported return. Nevertheless, the timing provides an interesting illustration of why internationally mobile individuals need to consider tax residence well before making a move.
There are also wider UK tax implications to consider, including the relatively new Foreign Income and Gains (FIG) regime, introduced from April 2025.
Regardless of domicile, an individual may, in certain circumstances, benefit from relief on qualifying foreign income and gains during their first four tax years of UK residence. Broadly, eligibility requires the individual to have been non-UK resident for the 10 consecutive tax years immediately before becoming UK resident.
Returning to the UK does not automatically mean becoming UK resident
Moving home and becoming UK tax resident are not necessarily the same thing.
Residence is determined separately for each tax year under the Statutory Residence Test. It considers factors including the number of days spent in the UK, where an individual has a home, where they work and the connections they retain with the UK.
The timing of a move can therefore be critical. Split-year treatment may also apply in some circumstances, dividing a tax year into UK and overseas parts.
If an individual becomes UK resident, they will normally be liable to UK tax on their worldwide income and gains arising during the period of UK residence, subject to any available reliefs and the terms of relevant double taxation agreements.
In other words, being outside the temporary non-residence rules does not provide a general exemption from UK tax after returning. It may simply mean that certain income and gains realised during the period of non-residence are not brought back into charge under those particular rules upon return.
Planning before the plane lands
The tax consequences of leaving or returning to the UK can extend far beyond temporary non-residence. Individuals may need to consider:
- Their residence position under the Statutory Residence Test
- The availability of split-year treatment
- Income and gains arising before and after the move, including the potential application of the FIG regime
- The location and disposal of investments and other assets
- Business interests and company distributions
- Trusts, pensions and inheritance tax
- Overseas tax liabilities and double taxation relief
- Registration and Self Assessment obligations
These issues should be reviewed before travel plans, property arrangements or commercial transactions are finalised. Once the relevant dates have passed, the available planning options can be considerably more limited.
How HURST can help
Karen Chadwick, our Private Client Tax Partner, has over 30 years’ experience advising business owners, entrepreneurs and high net worth individuals on complex personal and trust tax matters.
Karen and the HURST Private Client Tax team can help individuals and families understand their UK residence position, plan a move to or from the UK and manage the wider tax consequences of holding income, assets and business interests across different jurisdictions.
If you are considering returning to the UK, leaving the country or dividing your time between the UK and overseas, early advice can make a significant difference. Email us imagine@hurst.co.uk