David Prosser: Still waiting for the detail on residence rules

Outlook How difficult is it to decide whether someone lives in the UK? Very, if you're the Treasury, it would seem. While the Finance Bill, published yesterday, included stacks of new regulation on tax avoidance and the tax status of multi-national companies, it omitted the detail of the proposed new statutory residency tax, much to the disappointment of leading accountants and their clients.

The rules on who can claim they are not resident in the UK for tax purposes are complicated and unclear – all the more so since a string of legal cases pursued by an increasingly aggressive HM Revenue & Customs over the past 18 months. For a small but significant group of individuals, it is not sufficient to prove you have spent very few days in the UK during a tax year – you must also show you have very limited connections to the country.

Accountants had hoped the Finance Bill would finally provide some clarity – a new test to settle matters once and for all. The Treasury, however, now concedes it had underestimated the complexity of the issues. So it won't now introduce the new test until April 2013 at the earliest.

Getting the detail right is important, of course, but ministers have now been consulting on this for eight years. And while we wait, more and more tax revenue is slipping through the net.