The government should move to make tax laws clearer by introducing a statutory definition of residence, the Institute of Chartered Accountants in England and Wales (ICAEW) has said.
At present, the UK has no formal residence test and as some proposed changes to the tax regime concern residence and domicile, Francesca Lagerberg of the ICAEW tax faculty's technical committee believes the time has come for that to change.
"The UK is now out of line with international practice in maintaining a rule that is largely based on often conflicting case law and practice that does not deal satisfactorily with increased international mobility," she explained.
Ms Lagerberg added that a statutory definition would help to clarify the position for taxpayers, employers and those working in
tax jobs, as well as providing more certainty for HM Revenue and Customs officials as they attempt to implement changes to the system.
The Institute of Chartered Accountants of Scotland recently criticised government plans to change tax legislation relating to non-doms, describing them as "unwelcome" in the current economic climate.
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