Want to cut down on your tax bill? Why not live abroad, at least for part of the time?

Tax advisers share at least one feature with doctors. We are usually asked at parties, once our profession is discovered, about curing a pain that is troubling someone. The pain in question is fiscal rather than physical: the question is usually posed as: "How do I get out of paying tax?"

One immediate reaction is: "leave the country". Although a bit flip, it underlies a serious point. Going non-resident, or varying your residence status in some way, can significantly affect your tax bill.

There are probably three variants to look at: leaving the country altogether; still working here but only for part of the time; and working here, but not as a full citizen. As in all the best game shows, we'll take them in reverse order.

There are a lot of people working in this country who do not pay tax on all their income. Why not? Because they are non-domiciled. Here we need to introduce a couple of definitions: residence is physical being - if you're in the UK for over half the tax year, you're "resident". Be here generally, and you are "ordinarily resident".

"Domicile" is your real home. It's a funny concept in many ways - it isn't necessarily the country of your birth, though that is usually the start point. You can change during life; in the end, where you intend to be buried is an oft-quoted guide to your domicile. For example, many will remember Sir Charles Clore, the founder of Sears. Towards the end of his life, he left the UK and started to live in Monaco - but he had not completely shed his UK connections. Accordingly he was still UK domiciled when he died - and his estate fell into inheritance tax.

The income tax advantage of domicile is that if you are resident here but not UK domiciled, then you pay tax on non-UK income and gains basically only to the extent that you remit them to the UK. This helps a lot of expatriates who are working in the UK - and contributes to the UK being an attractive place for foreign investment. It requires care to manage your affairs to best effect - and, of course, it can mean that some income is left to be taxed "back home", which could even result in higher rates.

If you are UK domiciled, you may decide that you can do your work other than by daily attendance at the office. The thought of avoiding the daily battle with train/Tube/car is attractive. So how about basing yourself in, say, Jersey, and working from there? Electronic links now make it far easier to contemplate doing many tasks remote from the office. Being resident in Jersey means being taxed there - and you would still be able to come over to the UK from time to time, without becoming resident here.

The Inland Revenue would regard you as resident here if you were here for 183+ days; or if you made "regular and substantial" visits to the UK. Come here for 91+ days a year and you would definitely be in; shorter periods might still lead to your being caught.

Having a house here and visiting it during the year does not of itself make you resident, as it once did; but there are 19th-century cases to suggest you can be resident without even setting foot in the UK in the year.

If you are contemplating this route, the basic first step is to be resident somewhere other than the UK - and control your visits here. (As a day counts for residence purposes by being here at midnight, you can achieve a lot with a fast plane - but it's not an area to try to abuse.)

So what about leaving altogether? This thought often occurs to people who are facing a large capital gains bill. To establish non-residence you need to have a full-time job abroad for at least a full tax year, or to be out for at least three years. So it's not just a question of a night in Calais to offload your shares CGT-free.

Incidentally, this whole area is one that the Chancellor, Gordon Brown, is looking at - not necessarily to change on 2 July, but if you are thinking of taking advantage of the rules in this area, do bear in mind that changes may well happen before too long.

The writer is a tax partner at Price Waterhouse