Beta This part of GOV.UK is being rebuilt – find out what beta means

HMRC internal manual

International Manual

UK residents with foreign income or gains: capital gains tax: Deduction not credit

A deduction for the foreign tax should be made in the computation of the gain or loss when there is no claim to foreign tax credit relief or when no UK tax is chargeable on a gain; for example, when the UK computation shows a loss on the disposal and consequently there is no UK tax against which credit for any foreign tax can be given. No deduction is due, however, when credit relief is claimed, for any part of the foreign tax paid on a gain which does not qualify for credit because it exceeds the UK tax chargeable on the same gain.