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HMRC internal manual

Savings and Investment Manual

Savings and investment income: foreign income: unremittable income: claims

Unremittable income: claims and withdrawal of relief

A claim under ITTOIA/S842 does not mean that the income can be omitted from the taxreturn. The income must still be declared on the tax return but it will not be broughtinto charge if the claim is valid. This ensures that the amount of the income for eachyear is known so it can be assessed when the income becomes remittable.

Relief continues until the income becomes remittable. Exchange controls do change soanyone who makes a claim must check that the conditions for relief continue to besatisfied each year.

Withdrawal of relief

The income is assessable at the time it becomes possible to remit the income to the UK(ITTOIA05/S843). There is no requirement that the income must actually be remitted inorder for the charge to arise. If the source has ceased, the income is taxed as if thesource had not ceased (ITTOIA05/S844).

The income is treated as arising on the date on which the qualifying conditions cease tobe satisfied. The foreign currency amount is translated into sterling at the market rateon that date, or if there is no market in the currency, the official exchange rate for thecountry concerned (ITTOIA05/S845).


Martin has income from an interest-bearing account in Ruritania. Ruritania has exchangecontrols, and he cannot remit the income to the UK. The income first arises in 2002/03,when the account earns interest of 1,000 Ruritanian doubloons (RUD). RUD 1,250 arises in2003/04, and RUD 1,600 in 2004/05. In March 2005, Martin travels to Ruritania, closes theaccount and spends the money.

On 1 January 2008, Ruritania lifts the exchange controls and the income becomesremittable. Martin has validly claimed relief under ITTOIA/S842 (1). But in 2007/08, theincome is brought back into charge under ITTOIA/S843. It does not matter that he no longerpossesses the source of income (ITTOIA05/S844 (4)). Martin must include total income ofRUD 3,850 (1,000 + 1,250 + 1,600), translated into sterling at the exchange rateprevailing on 1 January 2008, in his 2007/08 self-assessment.