Does HMRC class a boat as a "home"?

Tim Good

Tim Good

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I must remain a UK resident for the sake of some "hold-over" tax issues. So whilst trying to calculate my residency status with the plan of doing some long term cruising the HMRC says:

You're automatically are a resident if:
"Your only home was in the UK - you must have owned, rented or lived in it for at least 91 days in total - and you spent at least 30 days there in the tax year" OR "you have UK home & overseas home but visits to overseas home minimal"... I.e. you have a holiday home or chalet.

So providing I spending a month in my UK house and they don't classify my boat as a home then I'll be resident. However, if they class my boat as a home then they catch me out and say I've stayed on my boat for a long time which is more than "visiting overseas home minimally".
 
If you do indeed have a house in the UK and are going to spend 30 days or more in it I wouldn't have thought they'd have much of a case arguing that a boat constitutes an overseas home. Maybe the real question is how prone are they to making things up as they go along to suit their ends? Sorry that's not much help...
 
northcave said:
I must remain a UK resident for the sake of some "hold-over" tax issues. So whilst trying to calculate my residency status with the plan of doing some long term cruising the HMRC says:

You're automatically are a resident if:
"Your only home was in the UK - you must have owned, rented or lived in it for at least 91 days in total - and you spent at least 30 days there in the tax year" OR "you have UK home & overseas home but visits to overseas home minimal"... I.e. you have a holiday home or chalet.

So providing I spending a month in my UK house and they don't classify my boat as a home then I'll be resident. However, if they class my boat as a home then they catch me out and say I've stayed on my boat for a long time which is more than "visiting overseas home minimally".
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I'm no expert but I would have thought that if you can prove that your boat moves - receipts from some different marinas etc. - then you can show that it's a means of transport and not at all a holiday home or chalet..
 
V1701 said:
Maybe the real question is how prone are they to making things up as they go along to suit their ends? Sorry that's not much help...
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For residencey info I found them very helpful if you go and talk to them. No mention of what 'their ends' were. Just valid info.

To the op, what about all the other tests? UK home is just one automatic test, many others to consider..
RDR3: Statutory Residence Test (SRT) notes
 
Yes I’ve check the automatic tests and non relate. There are only three automatic test which make you resident. 1 relates to hours worked in the UK and the other is about the min time spent in the UK. Both don’t help for someone wishing to circumnavigate and spend a while outside of the UK. The last one relates to the home which I’m asking about. It says:

  • at least 30 of these 91 days fall in the tax year when you have a home in the UK and you’ve been present in that home for at least 30 days at any time during the year
  • at that time you had no overseas home, or if you had an overseas home, you were present in it for fewer than 30 days in the tax year
So it comes back to whether you class a boat as a home or not.
 
Quite a lot of narrowboaters claim the boat as a home office. Personally I would not want to put the word 'boat' anywhere near HMRC to claim on fuel etc.
 
Tony Cross said:
I think the only way to know is to phone HMRC and ask....
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True but when I call I get flaky answers and they say the only way to sell is to write to them. Which I will do but last time I did it took 2.5 months to get a reply. Just wanted to see if anyone else has had a similar issue and knew the answer already.

I think for most people its not an issue to become non resident for a year but in my case it would trigger an enormous capital gains bill on our family business. I.e. they would charge us tax as if we'd sold it, even though we hadn't sold it. This they have confirmed in writing. So my only way of doing a circumnavigation without coming back to the UK regularly, is to remain a resident.
 
If you are keeping your UK home and you are paying your tax (and NI if appropriate), and using your home as your UK address, HMRC are unlikely to have an issue if you are having long holidays abroad. That's what a lot of long term cruisers do.
 
PlanB said:
If you are keeping your UK home and you are paying your tax (and NI if appropriate), and using your home as your UK address, HMRC are unlikely to have an issue if you are having long holidays abroad. That's what a lot of long term cruisers do.
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Agreed. But the consequences for most cruisers is fairly minor if HMRC decide to have an issue and declare them as non resident. As soon as the tax implications are significant then you’ll be surprised at how HMRCs ears prick up. The consequence in my case would be very significant and catastrophic for our family business which is why I’d like a definitive answer.
 
GHA said:
As non res I'm exactly the opposite - really want to keep on the right side of the revenue!! They're quite nice once you speak to them :)
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Agree, but it's always better to approach them from a position of strength and with a fair degree of knowledge in a specific and potentially complicated situation,, so Vic's suggestion is a good one.
 
A boat doesn't have a postcode, so can't be a residence. On the other hand a mooring/marina could have a postcode (and pay council tax, etc..)
 
RAI said:
A boat doesn't have a postcode, so can't be a residence. On the other hand a mooring/marina could have a postcode (and pay council tax, etc..)
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Can you point me to where in the HMRC guidance it says that a residence is classed by something that has a postcode please?
 
northcave said:
Can you point me to where in the HMRC guidance it says that a residence is classed by something that has a postcode please?
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instead of asking on this forum, why don't you speak to a tax consultant if there are considerable finds at risk. It sounds like you need professional advice
 
Boathook said:
I suspect no post code, HMRC can't write to you.
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They can and do. I wrote to them to see if I’d get a reply and I did. They answered some questions directly but refused to comment on a specific scenario as this constituted tax advice. They confirmed that even if I remained a resident, I could still fail the residency test. So in effect they’d charge tax as though I’d emigrated even though a remained a UK for tax purposes.

Ive followed up asking directly if they classified a boat as a “home”. This isn’t tax advice. It has nothing to do with postcode since they will classified a home aboard as a “home” and there are cases that a motor home could be a home. If they write back I’ll post it here for all to see and perhaps it may help someone else in the future.


geem said:
instead of asking on this forum, why don't you speak to a tax consultant if there are considerable finds at risk. It sounds like you need professional advice
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I have taken professional advice but since there is. I case law on this specific scenario then none of them are willing to stick their neck out and give a direct answer. Most say it should be fine, other say it’s not worth taking the risk.

And not taking to risk is telling a sailor he can’t go to sea. And that’s a god given british right Id day!
 
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