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HMRC internal manual

Employment Related Securities Manual

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HM Revenue & Customs
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Interaction of UK law and treaties - up to 5 April 2015: remittance basis and time apportionment - application of examples to periods from 6 April 2013

As mentioned at ERSM160200 Finance Act 2013 made changes to the taxation rules relating to residence from 6 April 2013, removing the concept of “ordinary residence” from the Taxes Acts. For ITEPA03/S26, the condition of the employee being not ordinarily resident (or “NOR”) was replaced by the condition of meeting “the requirement of section 26A”.

In addition, from the same date, the remittance basis may only be claimed by individuals not domiciled in the UK (although there are transitional arrangements mentioned at ERSM160200). Before that date the remittance basis was available to employees who met certain conditions in respect of their employment income where they were, on the one hand not domiciled but ordinarily resident in the UK, or, on the other hand, not ordinarily resident in the UK, Those two categories have, from 6 April 2013 been replaced by those employees who are not domiciled in the UK and do not meet the requirements of section 26A and those who are not domiciled in the UK and do meet the requirements of section 26A.

Therefore, where the following examples refer to non-domiciled employees they will apply in the same way from 6 April 2013 to employees who are not domiciled in the UK and do not meet the requirements of section 26A. Equally, examples that discuss the treatment of “NOR” employees apply in the same way from 6 April 2013 to employees who are not domiciled in the UK and do meet the requirements of section 26A.

In addition, from 6 April 2013, references to Extra Statutory Concession A11 (ESCA11) should be read as references to split-year treatment.