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# Taxation of UK residents on foreign income and assets  
 
# Taxation of UK residents on foreign income and assets  
  
It is the online version of the 2017/18 edition of [http://www.kessler.co.uk/taxation-of-foreign-domiciliaries/ ''Taxation of Non-Residents and Foreign Domiciliaries''] by [http://www.kessler.co.uk James Kessler QC].   
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It is the online version of [https://www.kessler.co.uk/taxation-of-foreign-domiciliaries/ ''Taxation of Non-Residents and Foreign Domiciliaries''] by [https://www.kessler.co.uk James Kessler QC].   
  
 
<div style="float: left; width: 33%">
 
<div style="float: left; width: 33%">
  
 
<big>'''Contents'''</big>
 
<big>'''Contents'''</big>
 +
 +
[[Update]]
  
 
[[Introduction]]
 
[[Introduction]]
  
:1  [[Foreign Domicile: Tax Policy and Reforms]]
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:1  [[Foreign Domicile: Tax Policy]]
  
:2  [[Tax Avoidance: Public Debate]]
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:2  [[Tax Avoidance]]
  
 
:3  [[Domicile]]  
 
:3  [[Domicile]]  
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:9  [[Split Years: Arrival and Departure]]
 
:9  [[Split Years: Arrival and Departure]]
  
:10  [[Temporary Non-residence: Post-2013 Departures]]
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:10  [[Temporary Non-residence]]
  
:10A  [[Temporary Non-residence: Pre-2013 Departures]]
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:11 [[Source/Relevant Foreign Income]]  
  
:11 [[The Remittance Basis]]
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:12 [[The Remittance Basis]]
  
:12 [[The Meaning of Remittance]]
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:13 [[The Meaning of Remittance]]
  
:13 [[Remittance Reliefs]]
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:14 [[Remittance Reliefs]]
  
:14 [[Mixed Funds]]
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:15 [[Mixed Funds]]
 
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:15  [[Income Categories and Sources]]
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:16  [[Trading Income]]
 
:16  [[Trading Income]]
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:17  [[Trading in Land]]
 
:17  [[Trading in Land]]
  
:18  [[Entertainers and Sportspeople]]
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:18  [[Performers]]
  
 
:19  [[Property Income]]
 
:19  [[Property Income]]
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:26  [[Employment Income]]
 
:26  [[Employment Income]]
  
:27  [[Travel Expenses: Employment Income Deduction]]
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:27  [[Travel Expenses: Employment Income]]
  
 
:28  [[PAYE]]
 
:28  [[PAYE]]
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:32  [[IIP Trusts: Income Tax]]
 
:32  [[IIP Trusts: Income Tax]]
  
:33  [[Settlor-interested Trusts]]
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:33  [[Settlor-interested Trust Code]]
  
 
:34  [[Transfer of Assets Abroad: Introduction]]
 
:34  [[Transfer of Assets Abroad: Introduction]]
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:35  [[Transfer of Assets Abroad: Transferors]]
 
:35  [[Transfer of Assets Abroad: Transferors]]
  
:36  [[Transfer of Assets Abroad: Non-transferors]]
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:36  [[Transfer of Assets Abroad: Benefits]]
  
 
:37  [[Transfer of Assets Abroad: Relief from Overlapping Charges]]
 
:37  [[Transfer of Assets Abroad: Relief from Overlapping Charges]]
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:38  [[Transfer of Assets Abroad: Motive Defence]]
 
:38  [[Transfer of Assets Abroad: Motive Defence]]
  
:39  [[Life Policies and Contracts]]
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:39 [[Profit Fragmentation]]
 +
 
 +
:40 [[Life Policies and Contracts]]
 +
 
 +
:41  [[Offshore Funds: Definition]]
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 +
:42  [[Offshore Income Gains]]
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 +
:43  [[Income from Offshore Funds]]
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 +
:44  [[Accrued Income Profits]]
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 +
:45  [[Deeply Discounted Securities]]
 +
 
 +
:46  [[Unit Trusts]]
 +
 
 +
:47  [[Intermediated Securities]]
 +
 
 +
:48  [[Partnerships]]
 +
 
 +
:49  [[Non-Residents Income Tax Relief]]
 +
 
 +
:50  [[Collection of Tax from UK Representatives]]
  
:40 [[Offshore Funds: Definition]]
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:51 [[Investment Manager Exemptions]]
  
:41 [[Offshore Income Gains]]
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:52 [[Investment Management Fees & Carried Interest]]
  
:42 [[Income from Offshore Funds]]
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:53 [[Loans from Non-Resident Companies]]
  
:43  [[Accrued Income Profits]]
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:54 [[Transactions in Securities]]
  
:44 [[Deeply Discounted Securities]]
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:55 [[Rates of Income Tax/CGT]]
  
:45 [[Unit Trusts]]
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:56 [[Personal Allowances]]
  
:46 [[Intermediated Securities]]
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:57 [[National Insurance Contributions]]
  
:47 [[Partnerships]]
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:58 [[Chargeable Gains]]
  
:48 [[Non-Residents Income Tax Relief]]
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:59 [[UK Property Held by Non-Residents]]
  
:49 [[Collection of Tax from UK Representatives]]
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:60 [[Private Residence Relief]]
  
:50 [[Investment Manager Exemptions]]
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:61 [[Gains of Non-Resident Settlor-Interested Trusts: s.86]]
  
:51 [[Investment Management Fees & Carried Forward]]
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:62 [[Capital Payments from Non-Resident Trusts: s.87]]
  
:52 [[Loans from Non-Resident Companies]]
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:63 [[Borrowing by Non-Resident Trust: Sch 4B]]
  
:53 [[Rates of Tax]]
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:64 [[Protected Trusts]]
  
:54 [[Personal Allowances and Annual Exemptions]]
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:65 [[Sub-Funds]]
  
:55 [[National Insurance Contributions]]
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:66 [[Gains of Non-Resident Companies]]
  
:56 [[Gains of UK Residents]]
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:67 [[Capital Losses]]
  
:57 [[Gains of Non-Resident Settlor-Interested Trusts: s.86]]
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:68 [[Foreign Currency Issues]]
  
:58 [[Capital Payments from Non-Resident Trusts: s.87]]
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:69 [[Unremittable Assets]]
  
:59 [[Borrowing by Non-resident Trust: Sch 4B]]
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:70 [[Double Taxation Arrangements: Introduction]]
  
:60 [[Protected Trusts]]
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:71 [[DTA Anti-abuse Rules]]
  
:61 [[Sub-Funds]]
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:72 [[Foreign Tax Credit Relief]]
  
:62 [[Gains of Non-Resident Companies]]
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:73 [[EU Law and UK Taxation]]
  
:63 [[Capital Losses]]
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:74 [[Excluded Property: Definition]]
  
:64 [[Foreign Currency Issues]]
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:75 [[Excluded Property Exemptions]]
  
:65 [[Unremittable Assets]]
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:76 [[Wills and IOVs]]
  
:66 [[Double Taxation Arrangements: Introduction]]
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:77 [[Reservation of Benefit]]
  
:67 [[DTA Anti-abuse Rules]]
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:78 [[Inter-Trust Transfers: IHT]]
  
:68 [[Foreign Tax Credit Relief]]
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:79 [[IHT Deduction for Debts]]
  
:69 [[EU Law and UK Taxation]]
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:80 [[IHT Double Taxation Treaties: Introduction]]
  
:70 [[Excluded Property: Definition]]
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:81 [[IHT DTAs: India, Pakistan, Italy, France]]
  
:71 [[Excluded Property Exemptions]]
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:82 [[IHT DTA: Netherlands]]
  
:72  [[Wills and IOVs]]
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:83 [[IHT DTA: Switzerland]]
  
:73 [[Reservation of Benefit]]
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:84 [[IHT DTA: USA]]
  
:74 [[Inter-Trust Transfers: IHT]]
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:85 [[Foreign IHT Credit Relief]]
  
:75 [[IHT Deduction for Debts]]
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:86 [[Non-Dom/Non-Resident Spouse]]
  
:76 [[IHT Double Taxation Treaties - Introduction]]
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:87 [[Family Home and Chattels: Benefit in Kind Charges]]
  
:77 [[IHT DTAs: India, Pakistan, Italy, France]]
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:88 [[IHT Residential Property Code]]
  
:78 [[IHT DTA: USA]]
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:89 [[Pre-Owned Assets]]
  
:79 [[IHT DTA: Switzerland]]
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:90 [[Joint Accounts]]
  
:80 [[IHT DTA: Netherlands]]
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:91 [[ATED Taxes]]
  
:81 [[Foreign IHT Credit Relief]]
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:92 [[Estates of Deceased Persons: CGT]]
  
:82 [[Marriage to Non-dom or Non-resident]]
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:93 [[Estates of Deceased Persons: Income Tax]]
  
:83 [[Private Residence Relief]]
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:94 [[Who is the Settlor?]]
  
:84 [[Residential Property of Non-Residents: NRCGT]]
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:95 [[Trusts with Two or More Settlors]]
  
:85 [[Family Home and Chattels: Benefit in Kind Charges]]
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:96 [[Situs of Assets for IHT]]
  
:86 [[Corporate Residential Property]]
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:97 [[Situs of Assets for CGT]]
  
:87 [[Residential property: IHT]]
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:98 [[Foreign Entities]]
  
:88 [[Pre-Owned Assets]]
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:99 [[Hybrid Entities]]
  
:89 [[Joint Accounts]]
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:100 [[Control Connected Close and Related Expressions]]
  
:90 [[Estates of Deceased Persons: CGT]]
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:101 [[Permanent Establishment and Branch/Agency]]
  
:91 [[Estates of Deceased Persons: Income Tax]]
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:102 [[Reporting and Compliance]]
  
:92 [[Who is the Settlor?]]
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:103 [[Claims]]
  
:93 [[Trusts with Two or More Settlors]]
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:104 [[Reporting and compliance: IHT]]
  
:94  [[Situs of Assets for IHT]]
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:105 [[Reporting Beneficial Owners]]
  
:95  [[Situs of Assets for CGT]]
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:106 [[Disclosure of Offshore Trusts]]  
  
:96  [[Foreign Entities]]
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:107 [[Requirement to Correct]]
  
:97  [[Hybrid Entities]]
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:108 [[Criminal Law and Professional Conduct]]
  
:98  [[Control Connected Close and Related Expressions]]
 
  
:99  [[Permanent Establishment and Branch/Agency]]
 
  
:100  [[Disclosure and Compliance]]
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<big>'''Appendices'''</big>
  
:101  [[Disclosure on Death ]]
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:[[Appendix 1A: Words of Dispute]]
  
:102 [[Disclosure of Offshore Trusts]]
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:[[Appendix 1: Common Legal Expressions]]  
  
:103  [[Criminal Law and Professional Conduct]]
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:[[Appendix 2: Family Terminology]]  
  
 +
:[[Appendix 3: Consideration, Arm's Length/Full Value]]
  
:[[Appendix 1: Common Expressions]]
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:[[Appendix 4: Associated Operations: IHT]]
  
:[[Appendix 2: Consideration, Arm's Length/Full Value]]
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:[[Appendix 5: Deeming Provisions]]
  
:[[Appendix 3: Associated Operations: IHT]]
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:[[Appendix 6: What Do We Mean by "Real"]]
  
:[[Appendix 4: Construction of Deeming Provisions]]
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:[[Appendix 7: Parliamentarians]]
  
:[[Appendix 5: What Do We Mean by "Real"?]]
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:[[Appendix 8: Visiting Forces]]
  
:[[Appendix 6: Parliamentarians]]
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:[[Appendix 9: How to Improve Residence and Domicile Taxation]]
  
:[[Appendix 7: Visiting Forces]]
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:[[Appendix 10: Reform of Offshore Anti-avoidance Rules]]
  
:[[Appendix 8: How to Improve Residence and Domicile Taxation]]
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:[[Appendix 11: UK Arrival or Departure: Tax Checklist]]
  
:[[Appendix 9: Reform of Offshore Anti-avoidance Rules]]
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:[[Appendix 12: The Wisdom of Parliament]]
  
:[[Appendix 10: UK Arrival or Departure: Tax Checklist]]
 
  
:[[Appendix 11: Welsh Devolution]]
 
  
 
</div>
 
</div>
  
  
<big>'''New 2017/18 edition'''</big>
+
<big>'''New 2019/20 edition now out'''</big>
  
The text is based on the Finance Bill (March 2017) and draft domicile legislation published July 2017. (At present some chapters remain to be updated: this is noted at the top of the chapter where appropriate. Some further formatting work also remains to be completed.  However the most important areas are all up to date.)
+
The 2019/20 printed edition of ''Taxation of Non-residents and Foreign Domiciliaries'' is now out. The online edition contains the text of the that edition with some subsequent [[Update | updates]].
  
The printed edition of the book, based on the Finance (no.2) Act in its final form, will be published in  November, and TFD online will then be updated to the text of the published book. 
+
To maintain unbroken access to TFD online you will need to order an online licence. To obtain this, go to
 +
[https://www.khpplc.co.uk/ the publishers website]
  
To access TFD online you will need to order a copy of the new edition with an online licence. To order the book, go to [http://www.khpplc.co.uk/products/91/Taxation-of-Non-Residents-and-Foreign-Domiciliaries the publishers online ordering]; to order a licence go to [http://www.khpplc.co.uk/products/82/Taxation-of-Non-Residents-and-Foreign-Domiciliaries-16th-Online-Edition online ordering] or [mailto:[email protected].uk?Subject=TFD%20online%20enquiry click here]
+
Licences for the old (2018/19) edition are no longer valid.
  
Licences for the old edition are no longer valid.
 
  
 
<big>'''How to login'''</big>
 
<big>'''How to login'''</big>
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Most of this site requires you [[Special:Userlogin|to login]].  To obtain a login licence:
 
Most of this site requires you [[Special:Userlogin|to login]].  To obtain a login licence:
  
:•  Every copy of the printed book has a 3 week trial licence (see inside back cover of volume 1)
+
    Every copy of the printed book has a 3 week trial licence (see inside back cover of volume 1) To order copies of the book [mailto:[email protected]?Subject=TFD%20enquiry email the publishers] or [http://khpplc.co.uk/ go to the publishers' website].
  
:•  You may purchase a single or multiple user licence:  To obtain these, go to the publishers online ordering [http://www.khpplc.co.uk/products/82/Taxation-of-Non-Residents-and-Foreign-Domiciliaries-15th-Online-Edition here (book)] and [http://www.khpplc.co.uk/products/82/Taxation-of-Non-Residents-and-Foreign-Domiciliaries-15th-Online-Edition here (licence)].  For multiple user licence [mailto:[email protected]?Subject=TFD%20contact%20publisher%20request%20multiple%20user%20licences contact the publishers].
+
    You may purchase a single or multiple user licence:  To obtain these [mailto:[email protected]?Subject=TFD%20contact%20publisher%20request%20multiple%20user%20licences contact the publishers].
  
:•  Without logging in, you can access: chap 1 [[Foreign Domicile: Tax Policy and Reforms]]; chap 2 [[Wake Up and Smell the Coffee: Public Debate on Tax Avoidance]]; chap 11A [[Temporary Non-residence: Pre-2013 Departures]].
+
    Without logging in, you can access: Chap 1 [[Foreign Domicile: Tax Policy]]; Chap 2 [[Tax Avoidance]].
  
 
You enter this site once you have registered and [[Special:Userlogin| logged in]] by clicking on the index on the left, or you can search the text.
 
You enter this site once you have registered and [[Special:Userlogin| logged in]] by clicking on the index on the left, or you can search the text.
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You need to register with the password for the current edition. Registration for an earlier edition is not valid.
 
You need to register with the password for the current edition. Registration for an earlier edition is not valid.
  
<big>'''How to comment'''</big>
+
<big>'''Comments please'''</big>
  
Users can also [[contribute to the text]] and if you can add anything extra which is worth saying, or spot anything that needs to be corrected, please do!. A copy of the next edition of the book will be given to the user who makes the most edits.  User contributions are reviewed by [http://www.taxchambers.com/barrister/oliver-marre/ Oliver Marre].   
+
Users can also [[contribute to the text]] and if you can add anything, or spot anything that needs to be corrected, please do!  A copy of the next edition of the book will be given to the user who makes the most edits.  User contributions are reviewed by [https://www.taxchambers.com/barrister/ross-birkbeck/ Ross Birkbeck].   
  
 
<big>'''If you want further advice'''</big>
 
<big>'''If you want further advice'''</big>
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To contact James Kessler QC [mailto:[email protected]?Subject=TFD%20online click here]
 
To contact James Kessler QC [mailto:[email protected]?Subject=TFD%20online click here]
  
To contact Oliver Marre, who reviews online contributions, [mailto:OliverMarre@15oldsquare.co.uk?Subject=TFD%20contact%20moderator%20request click here]
+
To contact Ross Birkbeck, who reviews online contributions, [mailto:rossbirkbeck@15oldsquare.co.uk?Subject=TFD%20contact%20moderator%20request click here]
  
 
For multiple user licences, or to install on a firm's intranet, [mailto:[email protected]?Subject=TFD%20contact%20publisher%20request%20multiple%20user%20licences contact the publishers].
 
For multiple user licences, or to install on a firm's intranet, [mailto:[email protected]?Subject=TFD%20contact%20publisher%20request%20multiple%20user%20licences contact the publishers].

Revision as of 11:24, 24 May 2019

This site provides comprehensive information about:

  1. Taxation of foreign domiciliaries
  2. Taxation of non-residents on UK income and assets
  3. Taxation of UK residents on foreign income and assets

It is the online version of Taxation of Non-Residents and Foreign Domiciliaries by James Kessler QC.

Contents

Update

Introduction

1 Foreign Domicile: Tax Policy
2 Tax Avoidance
3 Domicile
4 Deemed Domicile
5 Residence of Individuals
6 Residence of Trustees
7 Treaty-Residence
8 Exit Taxes
9 Split Years: Arrival and Departure
10 Temporary Non-residence
11 Source/Relevant Foreign Income
12 The Remittance Basis
13 The Meaning of Remittance
14 Remittance Reliefs
15 Mixed Funds
16 Trading Income
17 Trading in Land
18 Performers
19 Property Income
20 Deduction of interest from Property Income
21 Interest Income
22 Exempt Interest of Non-Residents
23 Dividend Income
24 Royalty Income
25 Misc Sweep-Up Income
26 Employment Income
27 Travel Expenses: Employment Income
28 PAYE
29 Employment Income: DT Relief
30 Pension and Annuity Income
31 Discretionary Trusts: Income Tax
32 IIP Trusts: Income Tax
33 Settlor-interested Trust Code
34 Transfer of Assets Abroad: Introduction
35 Transfer of Assets Abroad: Transferors
36 Transfer of Assets Abroad: Benefits
37 Transfer of Assets Abroad: Relief from Overlapping Charges
38 Transfer of Assets Abroad: Motive Defence
39 Profit Fragmentation
40 Life Policies and Contracts
41 Offshore Funds: Definition
42 Offshore Income Gains
43 Income from Offshore Funds
44 Accrued Income Profits
45 Deeply Discounted Securities
46 Unit Trusts
47 Intermediated Securities
48 Partnerships
49 Non-Residents Income Tax Relief
50 Collection of Tax from UK Representatives
51 Investment Manager Exemptions
52 Investment Management Fees & Carried Interest
53 Loans from Non-Resident Companies
54 Transactions in Securities
55 Rates of Income Tax/CGT
56 Personal Allowances
57 National Insurance Contributions
58 Chargeable Gains
59 UK Property Held by Non-Residents
60 Private Residence Relief
61 Gains of Non-Resident Settlor-Interested Trusts: s.86
62 Capital Payments from Non-Resident Trusts: s.87
63 Borrowing by Non-Resident Trust: Sch 4B
64 Protected Trusts
65 Sub-Funds
66 Gains of Non-Resident Companies
67 Capital Losses
68 Foreign Currency Issues
69 Unremittable Assets
70 Double Taxation Arrangements: Introduction
71 DTA Anti-abuse Rules
72 Foreign Tax Credit Relief
73 EU Law and UK Taxation
74 Excluded Property: Definition
75 Excluded Property Exemptions
76 Wills and IOVs
77 Reservation of Benefit
78 Inter-Trust Transfers: IHT
79 IHT Deduction for Debts
80 IHT Double Taxation Treaties: Introduction
81 IHT DTAs: India, Pakistan, Italy, France
82 IHT DTA: Netherlands
83 IHT DTA: Switzerland
84 IHT DTA: USA
85 Foreign IHT Credit Relief
86 Non-Dom/Non-Resident Spouse
87 Family Home and Chattels: Benefit in Kind Charges
88 IHT Residential Property Code
89 Pre-Owned Assets
90 Joint Accounts
91 ATED Taxes
92 Estates of Deceased Persons: CGT
93 Estates of Deceased Persons: Income Tax
94 Who is the Settlor?
95 Trusts with Two or More Settlors
96 Situs of Assets for IHT
97 Situs of Assets for CGT
98 Foreign Entities
99 Hybrid Entities
100 Control Connected Close and Related Expressions
101 Permanent Establishment and Branch/Agency
102 Reporting and Compliance
103 Claims
104 Reporting and compliance: IHT
105 Reporting Beneficial Owners
106 Disclosure of Offshore Trusts
107 Requirement to Correct
108 Criminal Law and Professional Conduct


Appendices

Appendix 1A: Words of Dispute
Appendix 1: Common Legal Expressions
Appendix 2: Family Terminology
Appendix 3: Consideration, Arm's Length/Full Value
Appendix 4: Associated Operations: IHT
Appendix 5: Deeming Provisions
Appendix 6: What Do We Mean by "Real"
Appendix 7: Parliamentarians
Appendix 8: Visiting Forces
Appendix 9: How to Improve Residence and Domicile Taxation
Appendix 10: Reform of Offshore Anti-avoidance Rules
Appendix 11: UK Arrival or Departure: Tax Checklist
Appendix 12: The Wisdom of Parliament



New 2019/20 edition now out

The 2019/20 printed edition of Taxation of Non-residents and Foreign Domiciliaries is now out. The online edition contains the text of the that edition with some subsequent updates.

To maintain unbroken access to TFD online you will need to order an online licence. To obtain this, go to the publishers website

Licences for the old (2018/19) edition are no longer valid.


How to login

Most of this site requires you to login. To obtain a login licence:

 Every copy of the printed book has a 3 week trial licence (see inside back cover of volume 1) To order copies of the book email the publishers or go to the publishers' website.

 You may purchase a single or multiple user licence: To obtain these contact the publishers.

 Without logging in, you can access: Chap 1 Foreign Domicile: Tax Policy; Chap 2 Tax Avoidance.

You enter this site once you have registered and logged in by clicking on the index on the left, or you can search the text.

You need to register with the password for the current edition. Registration for an earlier edition is not valid.

Comments please

Users can also contribute to the text and if you can add anything, or spot anything that needs to be corrected, please do! A copy of the next edition of the book will be given to the user who makes the most edits. User contributions are reviewed by Ross Birkbeck.

If you want further advice

If you do not find the answer to your question here, or if you want advice on which you can legally rely, you may instruct James Kessler QC to advise. See How to instruct James Kessler QC.

Archive editions

There are archive editions for years since 2003/04. These will occasionally be useful to investigate the tax position in earlier years, but the current edition will generally be the best starting point, as that has been written in the light of current HMRC guidance, and further thought and research.

Contact

If you have technical problems, or problems logging in, click here

To contact James Kessler QC click here

To contact Ross Birkbeck, who reviews online contributions, click here

For multiple user licences, or to install on a firm's intranet, contact the publishers.

Technical notes

TFD online is in technical terms a Wiki on the lines of Wikipedia, but only registered users can edit the text.

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