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HMRC internal manual

International Manual

UK residents with foreign income or gains: income arising abroad: Interest

There is no problem where the foreign tax is charged on gross interest and the UK charges that same interest as foreign income. The gross interest is doubly taxed and credit is due for any foreign tax charged against the UK income tax.

See INTM167120 onwards for the position with regard to Corporation Tax.

See INTM168000 onwards where, as in the case of financial concerns, interest is chargeable as trade income, the foreign country charges the gross interest, but in the UK the interest is only an element in arriving at the total trade profits of the concern.