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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: example - insufficient nomination

Isabella is a non-domiciled long-term UK resident who has claimed the remittance basis for 2014-15. She has £80,000 of UK employment income, and her un-remitted foreign income and foreign gains for the year are as follows:

Relevant foreign income - bank interest £45,000
Foreign employment income £5,000
Foreign capital gains £190,000


Isabella pays tax at a 40% tax rate on her nominated income and 28% on her nominated foreign gain. Nominated income and gains are taxed as if the remittance basis did not apply to them (ITA07/s809H(2)). Isabella chooses to nominate £10,000 of her foreign gains, and £40,000 of her bank interest (RFI), which creates a relevant tax increase of only £18,800

Under section 809H(4) a further £28,000 of foreign income is treated as having been nominated, to create a further £11,200 of income tax due.

  Calculation (a)     Calculation (b)    
Non-savings income            
20% on £31,865 = £6,373 £31,865 = £6,373
40% on £48,135 = £19254 £48,135 = £19,254
  £80,000   £25,327 £80,000   £25,327
Savings income            
40% on nominated RFI £40,000 = £16,000      
40% (2) on foreign income(1) nominated under s809H(4) £28,000 = £11,200      
Capital Gains            
28 % on nominated CG (4) £10,000 = £2800      
Total Income Tax and CGT Due     £55327(3)     £25327 (3)


Relevant Tax Increase is Total (a) £55327
  less Total (b) £25327
  Total   £30,000



  1. Section 809H(4) only allows an amount to be treated as foreign income, not capital gains, regardless of whether the individual has sufficient income to have made such a nomination. The actual composition of their offshore portfolio or their own nominations is irrelevant.
  2. Income merely treated as nominated will be taxed at the prevailing higher rate for employment/savings income, but it is not necessary to determine its precise nature.
  3. As a remittance basis user, Isabella has no personal allowances due.
  4. Rates used here for the purposes of this example only; use the rates applying in the relevant tax year.

Also refer to RDRM35100: remittances of nominated income or gains for details about the rules that may apply if Isabella remits any of her nominated income or gains in later years.