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HMRC internal manual

Employment Related Securities Manual

HM Revenue & Customs
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International from 6 April 2015: ascertaining chargeable and unchargeable foreign securities income - from 6 April 2015: not s26A employees with associated employments - detail

The basic rule is that for a tax year to which ITEPA03/S41H(3) & (4) apply in relation to an employment any securities income in respect of that employment will be treated as chargeable foreign securities income and will therefore be taxable only on remittance to the UK. ITEPA03/S41I, where it applies, modifies this basic rule.

It does this by taking the amount of chargeable foreign securities income determined under section 41H, and subjecting this to a just and reasonable test. The factors to be taken into account in applying this test are as follows:

  • the employment income for the period from all the employments mentioned in section 41I(1)(a) (this means the employment to which section 41H(3) applies, and any associated employments),
  • the proportion of that income that is general earnings to which ITEPA03/S22 applies (chargeable overseas earnings),
  • the nature of and time devoted to the duties performed outside the UK, and those performed in the UK, in the period, and
  • all other relevant circumstances

Only the amount of securities income which it is just and reasonable to regard as chargeable foreign securities income, having applied this wide-ranging test, is then treated as chargeable foreign securities income.

See also ERSM162630