What is my tax home if I work in two countries?
The tax home follows the main place of business or employment, so the answer comes from where the work is actually done rather than from where the contract was signed or the salary paid. Where duties are genuinely split, the question becomes which place is principal: where the workdays fall, where the employer expects the person to be, where the office or client base sits, and where the costs of working are incurred. If no location is principal, the claim to be based abroad becomes weak, and that has to be faced from the records rather than argued from the passport.
Can my tax home be somewhere I do not live?
Yes, and confusing the two is the most frequent error here. Residence asks which country may tax a person's income and on what basis. Domicile is a question of permanent attachment, used mainly in estate and succession work. Tax home asks something narrower: where the main place of business or employment is. A person can be resident in one country, domiciled in another and have a tax home in a third, and each answer is reached on its own facts. When somebody says their tax home is their house, they are usually answering a different question from the one asked.
Does keeping a house back home affect my tax home abroad?
It can, though not because a house is a tax home in itself. The purpose of the test is to see whether the person is genuinely based abroad, and a retained dwelling is evidence about where the base of living remains, particularly where the family is still in it, where trips back are frequent and long, and where the work abroad runs on a rotation. A property let out on ordinary commercial terms for a real term says something quite different from one kept available. Expect the house to be the first fact raised, and be ready to explain the working pattern alongside it.
Why does relief for working abroad depend on my tax home?
Because the relief is aimed at people whose working life has moved, not at people who have spent time away. The tax home test is the gate: it asks whether the main place of business or employment is outside the country, and the remaining conditions are only reached once it is satisfied. That is why a claim can fail on this point alone, with days abroad, a foreign lease and a foreign employer all in place. It is also why the test is worth settling before the year begins rather than at the point the return is being prepared.
Can someone who keeps moving between countries have a tax home?
Sometimes not, and that surprises people whose life has plainly left the country they came from. The test looks for a principal place of business or employment, and a pattern of short engagements in several places may produce none. The practical response is to look at what is actually stable: a base the person returns to between engagements, an office or registered place of business, the country the clients contract with, where equipment and records are kept. Where such a base exists the case can be made on those facts. Where none exists, the claim should not be made.
How do I evidence my tax home for a whole year?
With records made at the time that describe work rather than travel. Employment contracts and secondment letters showing where duties are to be performed, employer confirmation of the assigned location, a workday calendar, client contracts, invoices showing where services were delivered, the business premises or registration abroad, and the housing arrangements at both ends. A list of boarding passes answers a days question, not a tax home question. The file should be able to state in one sentence where the main place of work was, and then produce the documents that support the sentence.
Branch or subsidiary — which should we use to expand?
A branch keeps one taxpayer: results consolidate at home, losses are usable sooner, and the exposure is that the branch is a permanent establishment whose profit the host country taxes, sometimes with a branch tax on repatriation. A subsidiary is a separate taxpayer with limited liability and local rates, at the cost of withholding on dividends home and transfer pricing on everything between them. The deciding facts are usually expected losses, liability and exit plans. See branch against subsidiary.
Is "fund transfer pricing" the same thing as transfer pricing?
No — and if you came here to calculate FTP, this is not it. Fund transfer pricing is a bank's internal allocation of funding costs and benefits between its own business units, a treasury and asset-liability management discipline used to measure branch or product profitability. Tax transfer pricing is about prices between legally separate related parties across borders, and about which country taxes the resulting profit. The words overlap; the fields do not. See our transfer pricing work.
