Commentary

E1.1109 Charge under ITA 2007, s 720 on transfer of assets abroad—protected foreign-source income

Personal and employment tax

E1.1109 Charge under ITA 2007, s 720 on transfer of assets abroad—protected foreign-source income

E1.1109 Charge under ITA 2007, s 720 on transfer of assets abroad—protected foreign-source income

With regard to the charge to tax under ITA 2007, s 720 at E1.1103, protected foreign-source income is relevant for 2017/18 onwards as a consequence of the introduction of the deemed domicile rule at E6.323B. It is relevant as explained in E1.1107 where the chargeable UK resident individual is either non-UK domiciled or has deemed UK domicile only by virtue of past residence in the UK, ie where Condition B (but not Condition A) of the deemed domicile rule is met. Where relevant it gives an individual some relief from this charge. For this purpose, income is protected foreign-source income if1:

  1.  

    (a)     the income would be relevant foreign income (see E1.602) if it were the individual's own income

  2.  

    (b)     the person abroad is the trustees of a settlement

  3.  

    (c)     the trustees are non-UK resident for the tax year2

  4.  

    (d)     when the settlement was created the individual was not domiciled in the UK and, if it was created on or after 6 April 2017, the individual was not deemed domiciled in the UK for tax purposes (whether by virtue of Condition A or B at E6.323B), and

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