RDRM30005 - Remittance Basis: About the Remittance Basis Chapters -

Introduction

This manual does not attempt to reproduce material that is found in other manuals or information sources. Instead its purpose is to explain:

  • the remittance rules introduced by Finance Act 2008 and subsequent amendments.

The Remittance Basis and Finance Act 2008

The remittance basis has been available for many years, first appearing in tax legislation over 200 years ago. In more recent years it has largely applied to the taxation of foreign income and gains arising to UK residents who are either Not Ordinarily Resident and/or Not Domiciled within the UK. However, there were some differences between the treatment for foreign income arising from employment and that arising from investments, and between the availability of the remittance basis in respect of capital gains (restricted to non-domiciled individuals only). From 6 April 2013 the remittance basis is restricted to individuals who are not domiciled in the UK, as the introduction of the Statutory Residence Test (SRT) made the concept of not ordinarily resident obsolete.

Finance Act 2008 Schedule 7 introduced new rules at Chapter A1 Part 14 of ITA 2007 about the remittance basis. These apply with effect from 6 April 2008 and include a number of transitional provisions that deal with foreign income and gains arising in years before 2008-09 and are ‘remitted’ in 2008-09 or later.

Remittance basis before 6 April 2008

There is some information in this manual about the treatment of remittances in tax years before 2008-09. If you are dealing with any tax year before 2008-09 you must also refer to guidance in the employment income manual, savings and investment manual or capital gains manual as appropriate.

Please note that the remittance basis rules are complex in parts. Many sections of Chapter A1 Part 14 ITA 2007 interact with each other, and with other Taxes Acts. We have endeavoured to note and provide links to pages or other guidance manuals where possible. It is strongly advised that you do not simply ‘dip’ into pages of this section without reading and understanding the broader context from the surrounding pages and links.

(This content has been withheld because of exemptions in the Freedom of Information Act 2000)