RDRM35810 - Remittance basis: Amounts remitted: Special mixed funds: Overview

Prior to 6 April 2013 individuals who carried out some of their employment duties in the UK needed rules to determine whether general earnings remitted to the UK related to those duties performed in the UK or duties abroad. This was covered by Statement of Practice 1/09 (SP 1/09) which allowed a relaxation of the mixed fund rules at s809Q and s809R ITA 2007 if certain conditions were met.

From 6 April 2013 an individual who is claiming the remittance basis of taxation and has general earnings from an employment for a tax year and, those earnings include both general earnings within s15 (UK duties) and s26 (non-UK duties) of ITEPA 2003 can apply the special mixed fund rules if certain conditions are met.

The legislation applies to earnings and transfers from a mixed fund of such earnings for 2013-2014 onwards and only employees who are entitled to overseas workday relief (OWR) can apply.

From 6 April 2017 individuals who wish to claim OWR will have to check whether they are caught by the deemed domicile provisions Condition A and Condition B.

Individuals who are caught by Condition A will no longer be able to claim remittance basis and so will be unable to claim OWR and the Special Mixed Fund provisions.

For more information see the Domicile chapter within this manual.

Individuals will also be able to cleanse a special mixed fund, see RDRM35730 for details.