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HMRC internal manual

Residence, Domicile and Remittance Basis Manual

Remittance Basis: Introduction to the Remittance Basis: Comparisons with pre-April 2008 regime: Using the remittance basis - automatic versus claim

Before 2008-09, relevant foreign income, general earnings and capital gains taxable on the remittance basis were treated separately, with different legislation governing each

Foreign income (not earnings from employment) ITTOIA05/s829 and following
General earnings (non-UK) ITEPA03/s22 and s26
Capital gains (non-doms only) TCGA92/s12

Before 2008-09 the remittance basis applied automatically to UK resident but Not Ordinarily Resident and/or non-domiciled individuals (as appropriate) in respect of employment income and capital gains.

However individuals usually had to make a claim to obtain the benefit of the remittance basis in respect of their relevant foreign income RDRM31140. Relevant foreign income is defined in ITTOIA05/s830 but broadly speaking consists of foreign savings and investment income.

For tax years 2008-09 and following, the arising basis applies to all foreign income and gains, except where the remittance basis applies. In order for the remittance basis to apply, there will usually be a claim by the individual under ITA07/s809B. Such a claim is usually made on their Self Assessment tax return - refer to RDRM32020 - Claiming the remittance basis.

Note 1 - In both the pre 6 April and post 5 April 2008 regimes, only individuals who are resident but not domiciled in the UK can use the remittance basis for their foreign chargeable gains.

Note 2 - In certain circumstances individuals may choose for the remittance basis to apply without the need to claim on their Self Assessment tax return - refer to RDRM32100- Exceptions to the claims requirements.