What is EES?
EES is the new EU Entry/Exit System that was implemented on 12 October 2025. The system will be rolled out over the next 6 months and be fully implemented by April 2026.
EES is a new digital border management system that impacts non-EU nationals crossing into the Schengen Area of Europe requiring travelers to provide biometric data before crossing.
On your first crossing you can expect to register at a kiosk in border control and be required to provide your passport for scanning, your fingerprint and a facial photograph. These will be stored for three years meaning that on future crossings you will not be required to re-register, just scan your biometric data. If you refuse to provide the biometric data, then your crossing will be denied.
The idea behind the new regime is to support enforcement of short stay visa days by electronically tracking your movements into the Schengen area. A knock-on effect is an increase in your (and HMRC’s) ability to count the days that you are present in the UK for the purposes of ascertaining your UK tax residency position.
How will this impact my tax residency position?
There are many factors that impact your UK tax residency position. Since 2013, the UK has adopted the statutory residency test (SRT) which is a clear set of rules and guidelines to determine an individual’s tax residency status. Your tax residency status can impact your tax position in the UK and it is important to get it right. Broadly, if you are deemed to be a UK tax resident then you will be taxable in the UK on your worldwide income and gains.
Many of the tests in the SRT feature day counts – that is the number of midnights that you have been present in the UK in any period. In the past, HMRC may have asked for travel diaries or other evidence to support your position, however with the introduction of EES there will be much less scope for inaccuracy. The borders and immigration department share data with HMRC when there is a legal reason and justification to do so, such as to prevent fraud or assist in HMRC’s delivery of their statutory functions. Deliberately misstating your residency position can amount to fraud.
Is HMRC watching you? We know that HMRC are ramping up their surveillance powers, information sharing and usage of emerging technologies such as AI. It is possible that with the introduction of EES will, in time, help HMRC build up a pattern of individual movements to verify their tax residency status. Where HMRC detect a discrepancy, they will write to taxpayers and look into the discrepancy further. What should happen next will depend on the circumstances that have led to any under-declaration of tax:
Non-deliberate behaviour
Where tax has been underpaid but this was not as a result of any deliberate behaviour by the taxpayer, then it may be appropriate to make a voluntary disclosure to HMRC if errors span back beyond the current tax year or accounting period.
Deliberate behaviour
In some circumstances it may be more appropriate to consider the Contractual Disclosure Facility (or COP9). This is the only disclosure facility available that can offer protection to a taxpayer from criminal prosecution, provided a complete disclosure is then made to HMRC.
No error or omission
Occasionally HMRC’s information is incomplete or inaccurate, and there may be no disclosure issue at all. If you receive a letter from HMRC suggesting errors or omissions in your tax affairs but you believe this is incorrect, the letter should always be responded to so that HMRC can review and close the case. Otherwise, you are at greater risk of future enquiry.
As ever, it is vital that you determine your tax residency status correctly and, if you are not sure, you should seek professional advice. If HMRC were to enquire into your tax returns, they can and will request evidence to corroborate your position.
If you need help determining your tax residency position, or if you think you may have incorrectly determined your position in the past, contact the Menzies Tax Disputes and Disclosures experts today for a free confidential consultation.
Contact Our Experts
