Guide

Back in the UK within five years? Temporary non-residence explained

Q: I bought shares after I left. Are gains on them caught?

Not normally, if they were bought and sold while away. HS278 lists three exceptions, for assets with a link to the earlier time with sole UK residence.

Published 14 Oct 2026 · Updated 14 Oct 2026 · Sources checked 13 Oct 2026

HMRC’s temporary non-residence rules can apply to people who come back within 5 years.[2] In HMRC’s terms, two things must be true. The person had “sole UK residence” in at least 4 of the 7 tax years before their “year of departure”. And their time away was 5 years or less.[1][13]

Where the rules apply, some income and gains from the time away can be taxed in the year of return. Capital gains are one example.[1][8]

This guide explains HMRC’s rules in plain English. It doesn’t tell you your residence status or work out any tax.

These rules turn on exact dates. Use this guide to understand them, then check your own dates with a qualified adviser.

Already planning dates? Jump to How the five years are measured.

The short answer

The Statutory Residence Test (SRT) comes first. It decides whether you’re UK resident, one tax year at a time.[1]
Temporary non-residence rules come after that. They can tax certain income and gains from the time away when someone returns.[1][4]
Three conditions apply. They’re set out below, in plain English from HMRC’s RDR3.[1]
The five years are measured in a set way. To be outside the rules, your time away must be more than 5 years. That is, HMRC says, at least 5 years plus one day.[1][4]
Wages aren’t included. GOV.UK says the rules don’t cover wages or other employment income.[2]
What can be included: capital gains, certain pension payments, some company distributions and other items HMRC lists.[1][8]

Educational, not tax advice.

Residence first, then temporary non-residence

Under the SRT, each tax year is looked at separately. You can be UK resident one year and not the next.[1] A tax year can also be split into a UK part and an overseas part. That’s called split year treatment.[1]

HMRC’s help sheet HS278 explains the starting point for Capital Gains Tax (CGT):[3]

People are normally charged CGT on gains if they’re UK resident.
Someone who left the UK and stopped being UK resident isn’t normally charged on gains made in later years.
The exception is when the time away was temporary and they become UK resident again within a certain time.

HS278 also lists gains a non-resident can be taxed on anyway. Examples are disposals of an interest in UK land, including UK homes, and assets used by a trade carried on in the UK through a branch or agency.[3]

So being non-resident for some years doesn’t, by itself, settle what happens to gains from those years. Temporary non-residence is one reason why.

For how residence is tested, see Am I a UK tax resident? and when your situation changes mid-year.

The three conditions

RDR3, HMRC’s SRT guidance note, says you’re temporarily non-resident if all three of these apply:[1] The terms in bold are defined just below.

You had a residence period with sole UK residence, followed by one or more residence periods without it.
In 4 or more of the 7 tax years just before your year of departure, you had sole UK residence. A split year counts if it included a residence period with sole UK residence.
Your period of non-residence lasts 5 years or less.

The same conditions are in the law: Finance Act 2013, Schedule 45, paragraph 110.[13]

Two terms that matter

A residence period is one of these:[1][5]

a full tax year
the overseas part of a split year
the UK part of a split year

Treaty non-resident means that, under a double taxation agreement (DTA), you’re treated as resident in another country.[14] HS278 says a DTA has tie-breaker rules for people who are resident in both countries.[3]

Sole UK residence for a full tax year means you’re UK resident for that year, and at no time in it are you treaty non-resident. For a split year, only the UK part can count, and only if you’re not treaty non-resident at any time in that part.[1][5]

That’s why “sole” matters. You can be UK resident for a year and still not have sole UK residence. HMRC’s guidance says this happens if you’re treaty non-resident at some point in it.[12] HS278 says years, or UK parts of split years, when you’re treaty non-resident count towards your period of non-residence.[3]

How the five years are measured

This is where dates matter most.

Start: the day after your last residence period with sole UK residence.[1][6]
End: the day before your next residence period with sole UK residence.[1][6]
Mid-year dates: the period only starts or ends partway through a tax year if split year treatment applies.[1]
Length: it must be more than 5 years for the rules not to apply. HMRC’s example: if you leave on 4 May 2015 and return on 4 May 2020, the rules do not apply. The period ends the day before you return, and that span is more than 5 years.[1]

Two of HMRC’s own examples

HMRC’s manual gives these examples.[7] They’re HMRC’s figures, not a template for your dates.

HMRC example	What happened	HMRC’s conclusion
Louis	Left for the USA on 4 January 2018, with a split year. Returned on 9 March 2023, with a split year.	Non-resident for more than 5 years (4 January 2018 to 8 March 2023), so outside the rules. HMRC adds that he didn’t need 5 complete tax years.
Max	Moved to Poland on 22 February 2015 and was treaty non-resident from then. No split year that tax year. Returned on 26 May 2018, with a split year.	His year of departure was not the year he left. HMRC treated it as 2013–14, the tax year before. His period ran from 6 April 2014 to 25 May 2018, less than 5 years, so inside the rules.

Two points from these examples:[7]

It’s 5 years, not 5 complete tax years.
Your year of departure can fall earlier than the year you physically leave the UK.

If you left before 6 April 2013

The current rules only apply if your year of departure is 2013–14 or later. For 2012–13 or earlier, older rules apply, which are more limited in scope.[17] GOV.UK says that if you left the UK before 6 April 2013, the test is 5 full tax years.[2]

What can be taxed in the year you return

If the rules apply, the income and gains are taxed as if they arose in your period of return.[8] That’s the tax year you come back, or its UK part if it’s a split year.[8]

RDR3 lists these. It says the list includes, but isn’t limited to:[1]

certain pension payments, lump sums and certain other charges
income taxable under the disguised remuneration rules
remitted foreign income (for remittance basis users)
distributions from closely controlled companies
loans to participators written off or released
chargeable event gains (HS278 gives gains on life insurance policies as an example)[3]
offshore income gains
capital gains

GOV.UK says the rules don’t include wages or other employment income.[2]

Assets you bought after you left

HS278 says gains or losses on assets you bought after leaving, and sold while away, aren’t normally caught.[3] HMRC gives three exceptions:[3]

assets you got from someone who acquired them under “no gain, no loss” rules
assets whose cost was reduced by rollover relief on the disposal of another asset you owned
gains deferred from an asset you held before you left, which become taxable when you sell the new asset

Losses

HS278 says losses from the period can also become allowable in the year you return.[3]

Company dividends: a change from 6 April 2026

This section is only for people who own, or are linked to, a close company. This part applies to “material participators” in a close company, and their associates. The test looks at your year of departure (the UK part, if it’s a split year) and the 3 tax years before it. HMRC’s manual sets out these terms. It also covers overseas companies that would be close if they were UK resident.[9]

Returning on or after 6 April 2026: HMRC’s manual says the charge applies to the full dividend. That includes any part that relates to trade profits made while you were away.[9]
Foreign tax: if the dividend was taxed abroad during the time away, HMRC says the foreign tax can be offset against the UK income tax due on it. The foreign tax is given on the Self Assessment return.[9]
Returned before 6 April 2026: dividends from trade profits made while you were away weren’t charged.[9]

The 2026 edition of HS278 covers people returning in 2025–26, so it describes the earlier rule.[3]

Taxed in two countries

HS278 says a gain could be taxed abroad when it arises, then in the UK for the year of return. If so, you may be able to claim relief for double taxation. HS278 points to help sheet HS263 for how.[3]

Where it shows up on your tax return

SA109 notes. HMRC’s notes for the residence pages of the Self Assessment return (SA109) say you may be charged tax on certain income and gains when you return. For Income Tax, they point to RFIG21510 onwards if you left in 2013–14 or later. For CGT, they point to HS278.[15]
HS278 is year-specific. The 2026 edition is for the 2025–26 tax year and people returning that year.[3] HMRC’s manual says to choose the HS278 for the year you’re considering.[10]
HS278 is only an introduction. It says that if you’re in any doubt about your circumstances, you should ask your tax adviser.[3]

For the residence pages themselves, see SA109: UK days, ties and records.

Records that help

HMRC’s manual says checking these rules may mean looking at your residence for up to 7 years before your year of departure.[10] That means facts from years ago can matter.

For the SRT, HMRC suggests records that show the countries where you spent your days and midnights. Examples are your travel schedule, booking information, and tickets and boarding cards.[16] If you left the UK to live or work abroad, HMRC also mentions:[16]

the date you left the UK
visa or work permit applications
contracts of employment

HMRC says its record lists aren’t meant to be complete.[18]

Records matter for shares too. Shares bought while away may join an existing pool. HMRC’s manual says the shares you show as sold on your tax return should then be accepted for these rules. That’s as long as you’ve kept adequate records.[11]

A simple layout, offered as our suggestion rather than an HMRC form:

Field	What to put in it
Tax year	Each year from 7 years before you left to the year you return
Residence as filed	UK resident or not, as you reported it
Split year	Yes or no, and the split date
Treaty residence elsewhere	Any dates you were treaty resident in another country
Leaving and arrival dates	When you left and when you came back
Supporting records	Tickets, boarding cards, contracts, returns

Mark unclear entries as unclear. HMRC doesn’t say how these records should be laid out.

For more, see what records HMRC says to keep, how to count your UK days and working out UK days for a past tax year.

When to get advice

HS278 calls itself only an introduction.[3] These rules tie together the SRT, split years, tax treaties and several kinds of income. Consider qualified advice if:

your time away is close to 5 years
a split year or treaty residence affects your dates
you sold assets, took pension money or received company payments while away
you used the remittance basis before 6 April 2025, when it stopped being possible to claim it[3]

This page can’t tell you whether the rules apply to you. See also why documentation matters.

Frequently asked questions

Is it five years or five tax years?

Five years. HMRC says the period must be more than 5 years, that is at least 5 years plus one day.[1][4] In one of HMRC’s examples, a person was outside the rules without 5 complete tax years away.[7] The period only starts or ends mid-year if split year treatment applies.[1]

Do the rules tax my wages from working abroad?

GOV.UK says the rules don’t include wages or other employment income.[2]

What income and gains can be taxed when I come back?

RDR3 lists capital gains, certain pension payments, distributions from closely controlled companies, chargeable event gains, offshore income gains and other items. It says the list isn’t complete.[1] They’re taxed as if they arose in your period of return.[8]

I bought shares after I left. Are gains on them caught?

Not normally, if they were bought and sold while away.[3][11] HS278 lists three exceptions, for assets with a link to the earlier time with sole UK residence.[3]

Does a split year change the dates?

It can. HMRC says the period only starts or ends partway through a tax year if split year treatment applies.[1] If there’s no split year, the period starts or ends on a tax-year boundary.[1]

I paid tax abroad on the same gain. Is it taxed twice?

HS278 says you may be able to claim relief for double taxation. It points to help sheet HS263.[3]

What if I left the UK before 6 April 2013?

Older, more limited rules apply if your year of departure was 2012–13 or earlier.[17] GOV.UK says that if you left before 6 April 2013, the test is 5 full tax years.[2]

Sources

Checked on 13 October 2026. Dates are the update dates GOV.UK showed that day, not a statement that the law changed on those dates.

Educational information, not tax advice. Temporary non-residence can turn on exact dates, treaty residence and the type of income or gain. This page doesn’t decide your residence status, work out any tax or promise any outcome. Use current HMRC guidance and take advice from a qualified professional before you rely on it.