815 Alternative calculation of profits: introduction
Sections 816 and 817 (which provide for an alternative method of calculating profits) apply if—
(a) an individual qualifies for qualifying care relief for a tax year,
(b) the individual's total qualifying care receipts for the tax year exceed the individual's limit for the tax year,
(c) sections 822 and 823 do not apply (accounting date for trade not 5th April), and
(d) an election by the individual has effect to apply the alternative method of calculating profits for the tax year (see sections 818 and 819).
816 Alternative calculation of profits: trading income
(1) This section applies if the individual's qualifying care receipts for the tax year are the receipts of a trade.
(2) The profits of the trade for the tax year are—
(a) the individual's total qualifying care receipts for the tax year, less
(b) the individual's limit for the tax year.
817 Alternative calculation of profits: income chargeable under Chapter 8 of Part 5
(1) This section applies if the individual has qualifying care receipts for the tax year which are chargeable to income tax under Chapter 8 of Part 5 (income not otherwise charged).
(2) The amount charged for the tax year arising from all the arrangements from which the receipts are derived is—
(a) the individual's total qualifying care receipts for the tax year, less
(b) the individual's limit for the year.
818 Election for alternative methodof calculating profits
(1) An individual may elect for the alternative method of calculating profits given in sections 816 and 817 to apply if—
(a) the individual qualifies for qualifying care relief for a tax year,
(b) the individual's total qualifying care receipts for the tax year exceed the individual's limit for the tax year, and
(c) sections 822 and 823 do not apply (accounting date for trade not 5th April).
(2) An election under this section—
(a) must specify the tax year for which it is made, and
(b) has effect for that year (unless withdrawn by notice given by the individual).
(3) An election or notice of withdrawal under this section must be made or given to the Inland Revenue on or before—
(a) the first anniversary of the normal self-assessment filing date for the tax year for which the election is made, or
(b) such later date as the Inland Revenue may, in a particular case, allow.
(1) This section applies if—
(a) an individual does not make an election under section 818 for a tax year on or before the date for making the election, and
(b) an adjustment is made after that date to the profits from the individual's provision of qualifying care on which the individual is liable to tax for the tax year.
(2) The individual may make an election under this section to apply the alternative method of calculating profits given in sections 816 and 817 for the tax year.
(3) The election—
(a) must specify that tax year, and
(b) has effect for that tax year (unless withdrawn by notice given by the individual).
(4) An election or notice of withdrawal under this section must be made or given to the Inland Revenue on or before—
(a) the first anniversary of the normal self-assessment filing date for the tax year in which the adjustment is made, or
(b) such later date as the Inland Revenue may, in a particular case, allow.
(1) Sections 822 and 823 (which deal with the period of account of a trade not ending on 5th April) apply if—
(a) an individual qualifies for qualifying care relief for a tax year,
(b) the individual's qualifying care receipts for the tax year are the receipts of a trade, and
(c) the period of account in which those receipts accrue does not end on 5th April in the tax year.
(2) Where the profits of the trade are required under section 24A to be calculated on the cash basis, any reference in this section or sections 821 to 823 to the period of account in which receipts accrue is to be read as a reference to the period of account in which receipts are received.
(1) For the purposes of sections 822 and 823 the “relevant limit” for a period of account in which the individual's qualifying care receipts accrue is found by adding—
(a) the fixed amount for the tax year in which that period ends or (as the case may be) the individual's share of the fixed amount for that year (found in accordance with sections 808 to 810), and
(b) for each of the tax years in which the period of account falls, each amount per adult or child for the individual for each part of the period of account falling in that tax year.
(2) For this purpose an individual's amount per adult or child for a part of the period of account is each amount that would be the individual's amount per adult or child under section 811 for the tax year in which the part falls if that part were the income period for that year.
(1) This section applies if the individual's total qualifying care receipts for the period of account do not exceed the individual's relevant limit for the period.
(2) The profits or losses of the trade for the tax year are treated as nil.
(1) This section applies if—
(a) the individual's total qualifying care receipts for the period of account exceed the individual's relevant limit for the period, and
(b) the individual makes an election under this section.
(2) The profits of the trade for the tax year are—
(a) the individual's total qualifying care receipts for the period of account, less
(b) the individual's relevant limit for the period.
(3) Sections 818(2) and (3) and 819 (adjustment of assessment) apply for the purposes of an election under this section as they apply for the purposes of an election under those sections.
(1) In this group of sections (that is, this section and sections 825 to 827) an individual is a “relevant individual” if in a tax year—
(a) the full qualifying care relief in section 813 or 822 (trading income), or
(b) the alternative method of calculating profits under section 816 or 823 (trading income),
applies to the individual for the tax year.
(2) In this group of sections a period is a “relevant chargeable period” of a relevant individual if—
(a) it is a chargeable period of the individual, and
(b) it corresponds to the income period for the individual's qualifying care receipts in the tax year for which the individual is a relevant individual.
(2A) In this group of sections, in relation to a relevant individual—
(a) “the care business” means the provision of qualifying care by the individual,
(b) “care business expenditure” means qualifying expenditure incurred on the provision of plant or machinery wholly or partly for the care business,
(c) “care business pool” means a pool of care business expenditure (even if the balance for the time being is nil), and
(d) a reference to “another activity” is to a qualifying activity carried on by the individual other than the care business.
(2B) In this group of sections, plant or machinery is referred to as being “in” a pool if qualifying expenditure incurred on its provision has been allocated at any time to that pool.
(3) Expressions—
(a) which are used in CAA 2001 and in this group of sections, but
(b) which are not otherwise defined in this Chapter,
have the same meaning in this group of sections as in CAA 2001.
(1) This section applies if—
(a) at the beginning of a relevant chargeable period of a relevant individual, there is care business expenditure which has not been allocated to a care business pool,
(b) the individual is entitled under CAA 2001 to allocate the expenditure, or a part of it, to a care business pool for that period, and
(c) the previous chargeable period was not a relevant chargeable period.
(2) So much of the expenditure as the individual is entitled to allocate to a care business pool for that period is to be treated for the purposes of CAA 2001 as allocated to the appropriate kind of care business pool for that period (whether or not any of it is actually so allocated).
(3) For the different kinds of pool, see section 54 of CAA 2001.
(1) Subsection (2) applies to a care business pool for a relevant chargeable period of a relevant individual if the previous chargeable period was not a relevant chargeable period.
(2) CAA 2001 is to apply as if—
(a) a disposal event occurs immediately after the beginning of the relevant chargeable period in respect of plant or machinery in the pool,
(b) disposal receipts fall to be brought into account in the pool for the period because of that event, and
(c) the total of the receipts equals the sum of amount A and amount B (or nil if there are no such amounts).
(3) Amount A is the amount of any expenditure treated as allocated to the pool for the period by virtue of section 825 (whether or not any of it is actually so allocated).
(4) Amount B is the amount of any unrelieved qualifying expenditure carried forward in the pool from the previous chargeable period.
(1) This section applies if—
(a) disposal receipts fall to be brought into account in a pool for a relevant chargeable period by virtue of section 825A, and
(b) on the re-start date, the relevant individual still owns any of the plant or machinery which was in that pool and is still using any of it for the purposes of the care business.
(2) The re-start date is the first day of the first subsequent chargeable period which is not a relevant chargeable period.
(3) A reference in this section to the retained plant or machinery is to so much of the plant or machinery in the pool as the relevant individual—
(a) still owns on the re-start date, and
(b) is still using on that date for the purposes of the care business.
(4) The individual is to be treated under CAA 2001—
(a) as having brought the retained plant or machinery into use on the re-start date for the purposes of the care business,
(b) as having incurred capital expenditure on the provision of that plant or machinery for those purposes on that date, and
(c) as owning that plant and machinery as a result of having incurred that expenditure.
(5) The total amount of expenditure which the individual is to be treated as having incurred (for all of the retained plant or machinery) is the smaller of—
(a) the total market value of the retained plant or machinery on the re-start date, and
(b) an amount equal to the disposal receipts brought into account in the pool as described in subsection (1)(a).
(6) If the individual is treated under section 13 of CAA 2001 as having incurred notional expenditure before the re-start date as a result of bringing plant or machinery in the pool into use for the purposes of another activity, the amount mentioned in subsection (5)(b) must be reduced by the total amount of that expenditure, as determined in accordance with section 825C(2).
(7) But subsection (6) does not apply if the plant or machinery which was brought into use for the purposes of another activity is the retained plant or machinery (for example, where it was brought into use only partly for the purposes of that other activity).
(8) The question whether the provision of the retained plant or machinery is to be treated as wholly or only partly for the purposes of the care business is to be determined according to whether the use referred to in subsection (3)(b) is wholly or only partly for those purposes.
825C Plant or machinery used for other qualifying activities
(1) This section applies if—
(a) disposal receipts fall to be brought into account in a pool by virtue of section 825A because of a disposal event, and
(b) after that disposal event, the relevant individual brings any of the plant or machinery in that pool into use for the purposes of another activity.
(2) Section 13 of CAA 2001 has effect as if the total amount of the notional expenditure which the individual is treated under that section as having incurred, for all of the plant or machinery in that pool which is brought into use for the purposes of the other activity, were the smaller of—
(a) the total market value of that plant or machinery on the day on which it is brought into use for the purposes of that other activity, and
(b) an amount equal to the disposal receipts brought into account in the pool as mentioned in subsection (1)(a).
(3) Subsection (2) does not apply to plant or machinery brought into use for the purposes of another activity if—
(a) the individual is treated by virtue of section 825B as having already brought that plant or machinery into use for the purposes of the care business, or
(b) this section has already applied to that plant or machinery since the disposal event.
(4) The amount mentioned in subsection (2)(b) must be reduced by the appropriate sum if some plant or machinery in the pool is brought into use for the purposes of another activity after —
(a) the individual is treated by virtue of section 825B as having brought other plant or machinery in that pool into use for the purposes of the care business, or
(b) this section has applied to other plant or machinery in that pool since the disposal event.
(5) The appropriate sum is—
(a) in a case within paragraph (a) of subsection (4), the total amount of expenditure which the individual is treated by virtue of section 825B as having incurred on the provision of that other plant or machinery, and
(b) in a case within paragraph (b) of that subsection, the total amount of the notional expenditure (as determined in accordance with subsection (2)) which the individual is treated under section 13 of CAA 2001 as having incurred on the provision of that other plant or machinery since the disposal event.
(1) This section applies to an item of plant or machinery which a relevant individual—
(a) is treated by virtue of section 825B as bringing into use, or
(b) brings into use in circumstances where section 825C(2) applies.
(2) The date (in either case) on which the item is brought or treated as brought into such use is referred to in this section as the applicable date.
(3) The first disposal event to occur in respect of the item on or after the applicable date is to be regarded for the purposes of section 60(3) of CAA 2001 as the first such event.
(4) That event requires a disposal value to be brought into account regardless of anything to the contrary in section 64(1) of that Act.
(5) But a reference in section 62 of that Act to the amount of qualifying expenditure incurred by the individual on the provision of that item is a reference to the amount of qualifying expenditure originally incurred by the individual on its provision (and not to any proportion of the total amount treated by virtue of section 825B or 825C as having been incurred).
Capital expenditure (“excluded capital expenditure”) does not constitute qualifying expenditure for the purposes of CAA 2001 if it is—
(a) incurred by a relevant individual in a relevant chargeable period, and
(b) incurred on the provision of plant or machinery wholly or partly for the provision of qualifying care by the individual.
827 Excluded capital expenditure: subsequent treatment of asset
If a relevant individual incurs excluded capital expenditure in a relevant chargeable period, section 13 of CAA 2001 applies as if, on the first day of the first subsequent chargeable period which is not a relevant chargeable period—
(a) the individual brings into use for the provision of qualifying care such of the plant or machinery on which the expenditure was incurred as the individual still owns on that day, and
(b) the individual owns the plant or machinery as a result of incurring capital expenditure on its provision for other purposes.
828A Indexation of the fixed amount and the amount per adult and child
(1) This section provides for increases in the amounts specified in—
(a) section 808(2) (the fixed amount), and
(b) section 811(1A) and (2)(a) and (b) (the amount per adult or child),
if the consumer prices index for the September before the start of a tax year is higher than it was for the previous September.
(2) The amount specified in section 808(2) for the tax year is found as follows—
Step 1: multiply the amount for the previous tax year by the same percentage as the percentage increase in the consumer prices index.
Step 2: if the result of Step 1 is a multiple of £10, it is the increase for the tax year.
If the result of Step 1 is not a multiple of £10, round it up to the nearest amount which is a multiple of £10 and that amount is the increase for the tax year.
Step 3: add the increase for the tax year to the amount for the previous tax year and the result is the amount for the tax year.
(3) The amounts specified in section 811(1A) and (2)(a) and (b) for the tax year are found as follows—
Step 1: multiply the amount for the previous tax year by the same percentage as the percentage increase in the consumer prices index.
Step 2: if the result of Step 1 is a multiple of £5, it is the increase for the tax year.
If the result of Step 1 is not a multiple of £5, round it up to the nearest amount which is a multiple of £5 and that amount is the increase for the tax year.
Step 3: add the increase for the tax year to the amount for the previous tax year and the result is the amount for the tax year.
(4) Before the start of the tax year the Treasury must make an order replacing the amounts specified in the provisions listed in subsection (1) with the amounts which, as a result of this section, are the amounts for the tax year.
(5) In this section “consumer prices index” means the all items consumer prices index published by the Statistics Board.
This Part provides for—
(a) the charging of relevant foreign income of a person to whom section 809B, 809D or 809E of ITA 2007 applies (remittance basis),
(b) certain deductions in calculating relevant foreign income where that basis does not apply (see Chapter 3), and
(c) relief where a person is prevented from transferring income to the United Kingdom (see Chapter 4).
(1) In this Act “relevant foreign income” means income which—
(a) arises from a source outside the United Kingdom, and
(b) is chargeable under any of the provisions specified in subsection (2) (or would be so chargeable if section 832 did not apply to it).
(2) The provisions are—
(a) Chapter 2 of Part 2 (trade profits),
(b) Chapter 17 of Part 2 (adjustment income),
(c) Chapter 3 of Part 3 (profits of property business),
(d) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(e) Chapter 2 of Part 4 (interest),
(f) Chapter 4 of Part 4 (dividends from non-UK resident companies),
(g) Chapter 7 of Part 4 (purchased life annuity payments),
(h) Chapter 8 of Part 4 (profits from deeply discounted securities),
(i) Chapter 13 of Part 4 (sales of foreign dividend coupons),
(j) section 579 (royalties and other income from intellectual property),
(k) Chapter 3 of Part 5 (films and sound recordings: non-trading businesses),
(l) Chapter 4 of Part 5 (certain telecommunication rights: non-trading income),
(m) section 649 (estate income),
(n) Chapter 7 of Part 5 (annual payments not otherwise charged), and
(o) Chapter 8 of Part 5 (income not otherwise charged).
(3) But “relevant foreign income” does not include income chargeable as a result of—
(a) section 844 (unremittable income: income charged on withdrawal of relief after source ceases), or
(b) section 517C or 517E of ITA 2007 (profits on certain disposals concerned with land in the United Kingdom treated as trading profits).
(3A) “Relevant foreign income” does not include income paid in respect of a security, within the meaning of section 138ZB of TCGA 1992, if—
(a) the security is treated, for the purposes of that Act, as situated in the United Kingdom as a result of section 138ZB of that Act, and
(b) that section applies in respect of the security as a result of an issue of shares in or debentures of a company in exchange for, or in respect of, shares in or debentures of another company that is incorporated, and is resident, in the United Kingdom.
(4) For the treatment of other income as relevant foreign income, see—
(a) section 857(3) (a partner's share of a firm's trading income),
(aa) regulation 19 of the Offshore Funds (Tax) Regulations 2009 (S.I. 2009/3001),
(b) paragraph 6(3) of Schedule 3 to the Commonwealth Development Corporation Act 1999 (c. 20) (distributions by the Commonwealth Development Corporation),
(c) section 575(3) of ITEPA 2003 (taxable pension income: foreign pensions),
(d) section 613(4) of that Act (taxable pension income: foreign annuities),
(e) section 631(3) of that Act (pre-1973 pensions paid under the Overseas Pensions Act 1973 (c. 21)),
(f) section 635(4) of that Act (taxable pension income: foreign voluntary annual payments), ...
(g) section 679(2) of that Act (taxable social security income: foreign benefits).
(h) section 670A of ITA 2007 (accrued income profits),...
(i) sections 726, 730 and 735 of that Act (transfer of assets abroad: foreign deemed income) , and
(j) paragraph 46(2) of Schedule 2 to FA 2022 (qualifying asset holding companies).
832 Relevant foreign income charged on remittance basis
(1) This section applied to an individual's relevant foreign income for a tax year (“the relevant foreign income”) if section 809B, 809D or 809E of ITA 2007 (remittance basis) applies to the individual for that year (being a tax year before tax year 2025-26).
(2) For any tax year for which the individual is UK resident, income tax is charged on the full amount of so much (if any) of the relevant foreign income as is remitted to the United Kingdom—
(a) in that year, or
(b) in the UK part of that year, if that year is a split year as respects the individual.
(3) Subsection (2) applies whether or not the source of the income exists when the income is remitted.
(4) See Chapter A1 of Part 14 of ITA 2007 for the meaning of “remitted to the United Kingdom” etc.
(1) This section applies if an individual is temporarily non-resident.
(2) Treat any of the individual's relevant foreign income within subsection (3) that is remitted to the United Kingdom in the temporary period of non-residence as remitted to the United Kingdom in the period of return.
(3) Relevant foreign income is within this subsection if—
(a) it is relevant foreign income for the UK part of the year of departure or an earlier tax year, and
(b) section 832 applies to it.
(4) Any apportionment required for the purposes of subsection (3)(a) is to be done on a just and reasonable basis.
(5) Nothing in any double taxation relief arrangements is to be read as preventing the individual from being chargeable to income tax in respect of any relevant foreign income treated by virtue of this section as remitted to the United Kingdom in the period of return (or as preventing a charge to that tax from arising as a result).
(6) Part 4 of Schedule 45 to FA 2013 (statutory residence test: anti-avoidance) explains—
(a) when an individual is to be regarded as “temporarily non-resident”, and
(b) what “the temporary period of non-residence” and “the period of return” mean.
(7) In this section, “double taxation relief arrangements” means arrangements that have effect under section 2(1) of TIOPA 2010.
(1) The only case in which deductions are allowed from the income mentioned in section 832(2) is where the income is from a trade, profession or vocation carried on outside the United Kingdom.
(2) In that case the same deductions are allowed as are allowed under the Income Tax Acts where the trade, profession or vocation is carried on in the United Kingdom.
838 Expenses attributable to collection or payment of relevant foreign income
(1) In calculating the amount of relevant foreign income to be charged to income tax for a tax year, a deduction is allowed for expenses incurred outside the United Kingdom that are attributable to the collection or payment of the income.
(2) Subsection (1) does not apply to income charged for the tax year in accordance with section 832 (relevant foreign income charged on the remittance basis).
839 Annual payments payable out of relevant foreign income
(1) In calculating the amount of relevant foreign income to be charged to income tax for a tax year, a deduction is to be allowed for an annual payment other than interest if it meets conditions A, B1 or B2 and C .
(2) Condition A is that the payment is payable out of the relevant foreign income.
(3) Condition B1 is that, had the payment arisen in the United Kingdom, it would have been chargeable to income tax under one of the following provisions ...—
...
section 579 (charge to tax on royalties and other income from intellectual property),
Chapter 4 of Part 5 (certain telecommunication rights: non-trading income), ...
Chapter 7 of Part 5 (annual payments not otherwise charged).
, or regulation 15 of the Unauthorised Unit Trusts (Tax) Regulations 2013.
(3A) Condition B2 is that, had the payment arisen in the United Kingdom it would have been—
(a) required to be brought into account under Part 5 of CTA 2009 (loan relationships) as a non-trading credit, or
(b) chargeable to corporation tax under Chapter 7 of Part 10 of that Act (annual payments not otherwise charged) or regulation 15 of the Unauthorised Unit Trusts (Tax) Regulations 2013 .
(4) Condition C is that the payment is made to a non-UK resident.
(5) Subsection (1) does not apply if—
(a) the relevant foreign income is received in the United Kingdom, or
(b) it is charged for the tax year in accordance with section 832 (relevant foreign income charged on remittance basis).
(6) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
840 Relief for backdated pensions charged on the arising basis
(1) This section applies if—
(a) as a result of section 575(3), 613(4) or 635(4) of ITEPA 2003 a pension or annuity or an increase in a pension or annuity is treated as relevant foreign income,
(b) the pension, annuity or increase is paid in respect of a tax year (“the earlier year”) before the tax year in which the pension, annuity or increase arose, and
(c) the income is not charged in accordance with section 832 (relevant foreign income charged on the remittance basis).
(2) If the person liable for the income tax makes a claim for relief under this section for the tax year in which the pension, annuity or increase paid in respect of the earlier year arises, that pension, annuity or increase is treated as income arising in the earlier year from a source that the person possessed in the earlier year.
(3) But subsection (2) does not affect the calculation of the full amount of the income so arising under section 575(2), 613(3) or 635(3) of ITEPA 2003 (under which the full amount of that income is to be calculated on the basis that the pension or annuity is 90% of its actual amount).
(4) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(1) A claim under section 840 must be made not more than 4 years after the end of the tax year for which the relief is claimed.
(2) All adjustments (by way of repayment of tax, assessment or otherwise) are to be made which are necessary to give effect to section 840.
(3) Those adjustments may be made at any time, despite anything to the contrary in the Income Tax Acts.
(4) A person's personal representatives may make any claim under section 840 which the person might have made.
(5) If a person dies—
(a) any tax paid by the person and repayable because of a claim under section 840 is to be repaid to the personal representatives, and
(b) the person's personal representatives are liable for any additional tax which arises because of a claim under that section.
(6) If subsection (5)(b) applies, the additional tax—
(a) is to be assessed on the personal representatives, and
(b) is a debt due and payable out of the estate.
(1) This Chapter applies if—
(a) a person is liable for income tax on income arising in a territory outside the United Kingdom, and
(b) the income is unremittable.
(2) For the purposes of this Chapter, income is unremittable if conditions A and B are met.
(3) Condition A is that the income cannot be transferred to the United Kingdom by the person who is liable for income tax in respect of the income because of—
(a) the laws of the territory where the income arises,
(b) executive action of its government, or
(c) the impossibility of obtaining there currency that could be transferred to the United Kingdom.
(4) Condition B is that the person who is liable for income tax in respect of the income has not realised it outside that territory for an amount in sterling or in another currency which the person is not prevented from transferring to the United Kingdom.
(5) This Chapter does not apply to accrued income profits which a person is treated as making under Chapter 2 of Part 12 of ITA 2007, but see sections 668 and 669 of that Act (which make similar provision).
(1) If a person liable for income tax on unremittable income makes a claim for relief under this section in respect of that income, it is not taken into account for income tax purposes.
(2) Subsection (1) is subject to section 843.
(3) No claim under this section may be made in respect of any income so far as an ECGD payment has been made in relation to it.
(4) In subsection (3) “ECGD payment” means a payment made by the Export Credit Guarantee Department under an agreement entered into as a result of arrangements made under—
(a) section 2 of the Export and Investment Guarantees Act 1991 (c. 67) (insurance in connection with overseas investment), or
(b) section 11 of the Export Guarantees and Overseas Investment Act 1978 (c. 18).
(5) A claim under this section must be made on or before the first anniversary of the normal self-assessment filing date for the tax year for which the income would be charged to tax if no claim were made.
(1) This section applies if—
(a) a claim under section 842 has been made in relation to any income, and
(b) either—
(i) the income ceases to be unremittable, or
(ii) an ECGD payment is made in relation to it.
(2) In this section “ECGD payment” has the meaning given by section 842(4).
(3) If income ceases to be unremittable, the income is treated as arising on the date on which it ceases to be unremittable.
(4) If an ECGD payment is made in relation to income, the income is treated, to the extent of the payment, as arising on the date on which the ECGD payment is made.
(5) The income treated as arising under subsection (3) or (4), and any tax payable in respect of it under the law of the territory where it arises, are taken into account for income tax purposes at their value at the date on which the income is treated as arising.
(6) Subsections (3) to (5) do not apply so far as the income has already been treated as arising as a result of this section.
(7) If a person who would have become liable for income tax as a result of this section has died—
(a) the personal representatives are liable for the tax instead, and
(b) the tax is a debt due from and payable out of the estate.
844 Income charged on withdrawal of relief after source ceases
(1) This section applies if—
(a) income is treated as arising as a result of section 843, and
(b) at the time it is so treated the person who would have become liable for income tax as a result of that section—
(i) has permanently ceased to carry on the trade, profession, vocation or property business from which the income arises, or
(ii) in the case of income from another source, has ceased to possess that source.
(2) In the case of income from a trade, profession or vocation—
(a) the income is treated as a post-cessation receipt for the purposes of Chapter 18 of Part 2 (trading income: post-cessation receipts), but
(b) in the application of that Chapter to that income, section 243 (extent of charge to tax) is omitted.
(3) In the case of income from a property business—
(a) the income is treated as a post-cessation receipt from a UK property business for the purposes of Chapter 10 of Part 3 (property income: post-cessation receipts), but
(b) in the application of that Chapter to that income, section 350 (extent of charge to tax) is omitted.
(4) In the case of income from another source, the income is taxed as if the person continued to possess that source.
(1) If no claim is made under section 842 in relation to unremittable income arising in a territory outside the United Kingdom, the amount of the income to be taken into account for income tax purposes is determined as follows.
(2) If the currency in which the income is denominated has a generally recognised market value in the United Kingdom, the amount is determined by reference to that value.
(3) In any other case, the amount is determined according to the official rate of exchange of the territory where the income arises.
845A Claim for relief for qualifying new residents
(1) An individual may make a claim for relief for a tax year under this section (a “foreign income claim”) if the individual is a qualifying new resident for that year (see section 845B).
(2) Where an individual makes a foreign income claim for a tax year, the individual is entitled to relief for the tax year that is equal to so much of the total income of the individual for that year as—
(a) reflects qualifying foreign income (see section 845H), and
(b) is identified as such in the claim.
(3) The relief is given by deducting the amount of the relief in calculating the individual's net income for the tax year (see Step 2 of the calculation in section 23 of ITA 2007).
(3A) But a deduction for that purpose is to be made only from qualifying foreign income.
(4) A foreign income claim must be made in a return.
(5) A foreign income claim in relation to a tax year must be made before the end of the period of 12 months beginning with 31 January after the end of that tax year.
(6) A foreign income claim may not be made as a consequential claim (within the meaning of section 43C(5) of TMA 1970) if the circumstances which give rise to the consequential claim result from a loss of tax brought about carelessly or deliberately by the individual or a person acting on the individual’s behalf.
(7) See also—
(a) Chapter 5C of Part 2 of ITEPA 2003 which provides for a claim for relief that may be made in respect of foreign employment income where a foreign employment election is made, and
(b) Schedule D1 to TCGA 1992 which provides for a claim for relief that may be made in respect of foreign gains (a foreign gain claim).
(8) Sections 845C to 845E set out some income tax consequences of a foreign income claim, a foreign employment election or a foreign gain claim.
(9) See also section 1K of TCGA 1992, which provides for the loss of an individual’s annual exempt amount for capital gains tax where a foreign income claim, a foreign employment election or a foreign gain claim is made.
(10) For the purposes of this section—
(a) “return” means a return under section 8 of TMA 1970 (personal return),
(b) references to a claim being included in a return include a claim being so included as a result of an amendment of the return, and
(c) subsections (5) to (7) of section 118 of TMA 1970 (loss of tax brought about carelessly or deliberately) apply for the purposes of this section as they apply for the purposes of that Act.