Commentary

E1.603 Relevant foreign income charged on the remittance basis

Personal and employment tax

E1.603 Relevant foreign income charged on the remittance basis

E1.603 Relevant foreign income charged on the remittance basis

The normal basis of assessment of relevant foreign income is the arising basis. This is the amount of income arising in the tax year. However, in certain circumstances, a person may make a claim for the income to be charged to tax on the remittance basis (ie on the amount of the income received in the UK in the tax year).

Position before 6 April 2008

Claim for remittance basis

It was possible for a person to make a claim for relevant foreign income for a tax year to be charged to tax on the remittance basis. For a claim to be successful it had to state that either condition A or condition B was met1.

Condition A was that the person should not be domiciled in the UK.

Condition B was that the person should not be ordinarily resident in the UK.

The rules for making a claim were based on those previously in TA 1988, s 65(4). However, the former citizenship condition was removed, thereby allowing any person who was not ordinarily resident in the UK to make a claim2.

A claim could not be made in respect of relevant foreign income arising in the Republic of Ireland3 as such income was never charged to tax on the remittance basis.

Where a claim for the remittance basis was successful for a particular tax year, the rules set out in ITTOIA 2005, ss 838–845 (Pt 8, Chs 3 and 4) did not apply to the relevant foreign

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