Why five years is not enough on its own
The temporary non-residence rules catch you if two conditions are both met: you had sole UK residence in at least 4 of the 7 tax years before the year you left, and your period of non-residence is 5 years or less. To escape, the period must exceed 5 years, which HMRC states means a minimum of five years plus one day. The period runs from the end of your last period of sole UK residence to the start of the next one, and it only starts or ends partway through a tax year where split-year treatment applies. Five calendar years can still fall inside the window on the correct Statutory Residence Test and split-year dates. If caught, gains on assets you owned before leaving, including your own company shares, are treated as accruing in the year you return and taxed at that year's rates. Our temporary non-residence guide works through the dates.
MVL or strike off, and what a non-resident pays
How the money comes out decides how it is taxed. On a strike off through form DS01, distributions made in anticipation of dissolution are capital only if they total £25,000 or less; a pound over and the whole amount is an income dividend, not just the excess. A Members Voluntary Liquidation, run by a licensed insolvency practitioner, lets reserves of any size be distributed as capital, which is why it is the standard route for a meaningful pot. A capital distribution is a disposal of your shares, and if you have already become non-resident before the disposal your access to UK CGT treatment changes, because non-residents are generally outside UK CGT on shares. That looks like a clean result, and once your absence genuinely exceeds five years the temporary non-residence rule should not apply. Inside the window it can claw the whole charge back. Our closing a UK company guide compares both routes.
The other things that can bring UK tax back
Three further points can change the answer even after five years. First, the Targeted Anti-Avoidance Rule does not switch off at the border: wind up a UK consultancy, take the reserves as capital, and within two years carry on the same or a similar trade abroad, with a tax advantage as a main purpose, and the distribution can be re-taxed as income. Second, the country you now live in may tax the distribution under its own rules, and whether you suffer double tax depends on the double tax treaty between the UK and that country. Third, the company itself must be put to bed properly before it disappears: cease trading, settle creditors, file final accounts and a final Company Tax Return, pay any Corporation Tax due, and close the PAYE scheme. Anything still inside the company at dissolution passes to the Crown as bona vacantia. Confirm your own dates under the Statutory Residence Test before instructing a liquidator.