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HMRC internal manual

PAYE Manual

From
HM Revenue & Customs
Updated
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PAYE operation: double taxation claims submitted by non resident individuals: general principles

General principles

Where an individual has income from a source in one country and is resident in another, the individual may be liable to tax in both countries under their tax laws. To avoid ‘double taxation’ the United Kingdom has negotiated double taxation (DT) treaties with more than 100 countries. Each treaty is called either a ‘Double Taxation Agreement’ or a ‘Double Taxation Convention’, depending on the wording of the treaty.

When the individual is a resident of a country with which the UK has a double taxation treaty, they may be able to claim relief from UK tax on certain types of income from UK sources. The precise conditions of relief can be found in the text of the relevant treaty.

Note: Individuals are required to complete a new Double Taxation Individual form for all new sources of income, irrespective of whether a Double Taxation Individual form is already in place.

The DT Digest (PDF 184KB) (HMRC website) (external users can find the guidance at http://www.hmrc.gov.uk/taxtreaties/dtdigest.pdf) summarizes the main provisions of the double taxation treaties we deal with.

The Double Taxation Relief Manual (HMRC website) (external users can find the guidance at http://www.hmrc.gov.uk/manuals/dtmanual/DT2140+.htm) provides more information on specific countries.

Claim forms

These forms (HMRC website) (external users can find the guidance at http://www.hmrc.gov.uk/international/dta-claim.htm) are for an individual resident in a country with which the UK has a double taxation treaty, who wants to claim relief on UK state retirement pension or incapacity benefit, UK pensions, purchased annuities, interest or royalties.