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HMRC internal manual

Residence, Domicile and Remittance Basis Manual

HM Revenue & Customs
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Remittance Basis: Accessing the remittance basis: Claiming the remittance basis: Making a claim

UK resident individuals who meet the status conditions RDRM32010 (not ordinarily resident and/or not domiciled with the UK must decide each year whether they wish to be taxed on the remittance basis or not in respect of their foreign income and/or gains, as applicable.

The Self Assessment system is the mechanism by which a claim to the remittance basis is made in the majority of cases. There are some exceptions at ITA07/s809D and ITA07/s809E to the requirements to make a formal claim which are covered in detail below, refer to RDRM32100 Exceptions to the claims requirements.

The SA109 is the supplementary page to the SA return which covers ‘Residence, Remittance basis etc’.

From 2008-09 the return contains questions which cover the status conditions and allow individuals to make the declarations of their residence and domicile status. These cover:

  • Residence status
  • Ordinarily resident status
  • Domicile status
  • Making a claim for the remittance basis
  • Cases where un-remitted income and capital gains is below the £2,000 threshold
  • Cases where the individual is under 18 years of age at 5 April
  • Cases where the individual has been UK resident in seven or more of the preceding nine tax years
  • Nominations of income and gains to constitute the remittance basis charge

Detailed guidance on the new remittance basis regime including:

  • who can claim
  • status conditions
  • exceptions when a claim is not required
  • the remittance basis charge (RBC)
  • nominated foreign income and gains
  • paying the remittance basis charge etc are on the following pages of this guidance.

Guidance is also provided in the HMRC publication ‘Residence, Domicile and the Remittance Basis’ (HMRC 6). This guidance provides an overview of what the remittance basis of taxation is about, as well as covering residence status and domicile.

If an SA return has been issued or requested then the claim must be included in the return when the taxpayer files it.

If the return is subsequently amended, the claim may be included then or a previously made claim may be amended or deleted (TMA70/s42(5)). However when the time period for making an amendment has passed, the claim may not be withdrawn even if the making of the claim turns out to have been an error. This is because error or mistake relief does not apply to claims made to use the remittance basis under ITA07/s809B (TMA70/s33(2A)(c)).

Foreign losses

With the exception of individuals who may use the remittance basis under ITA07/s809D or s809E without claim (refer to RDRM32100 Exceptions to the claim requirements), non-domiciled remittance basis users are required to make an election under TCGA1992/s16ZA if they wish to enable their overseas losses to be offset against foreign chargeable gains.

The election should be made for the first year for which the remittance basis is claimed, irrespective of whether the individual has any foreign chargeable gains or overseas losses in that year. The election will usually be made within the white space in the Capital Gains supplementary pages of the same SA Return as the first remittance basis claim is made.

Refer to either RDRM31170 Foreign chargeable gains for more details or the Capital Gains Manual at CG25330 onwards.