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HMRC internal manual

Residence, Domicile and Remittance Basis Manual

Remittance basis: accessing the remittance basis: remittance basis charge - nomination of foreign income and gains: relevant tax increase

The Remittance Basis Charge (RBC) is either income tax or capital gains tax, or a combination of the two.  It is tax due on nominated foreign income and/or nominated foreign gains respectively.

 

This is achieved through a calculation of the “relevant tax increase”, which is actually the difference between two tax calculations;

 

In brief, the first calculation is of the total tax actually payable by the individual in the tax year, including such tax as results from the nomination. The second calculation, yielding a lower amount, is the total of the tax payable by the individual in the tax year less tax charged on nominated foreign and nominated gains see examples.

 

The Remittance Basis Charge cannot exceed £30,000 for those individuals who have been UK resident in at least 7 out of 9 years or £60,000 (previously £50,000 up to 2014-15) for those individuals who have been UK resident in at least 12 out of 14 years, or £90,000 for those individuals who have been UK resident in at least 17 out of 20.  Any nominations which produce an excessive relevant tax increase invalidate the claim under section 809B to be taxed on the remittance basis.