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HMRC internal manual

Employment Related Securities Manual

Ascertaining Foreign Securities Income (FSI) - up to 5 April 2015: non-domiciled/not s26A employees - conditions to be met

An employee who is non-domiciled in the UK can have FSI in a tax year if all the following conditions (in ITEPA03/S41C(4)) are met:

  • section 809B, 809D or 809E of ITA 2007 applies to the individual for the year,
  • the individual is ordinarily UK resident in the year (from 6 April 2013 the individual does not meet the requirements of section 26A),
  • the employment is with a foreign employer, and
  • the duties of the employment are performed wholly outside the UK

What this means in practice is that we establish the relevant period applicable to the securities income (see ERSM160700) and then examine the position for each tax year in which the relevant period falls (whether wholly or in part). For each tax year in which the four conditions set out above are met (subject to ITEPA03/S41D - see ERSM160830) the securities income treated as accruing in that year is FSI, and is therefore taxable only if remitted to the UK.