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Employment Income: Scope |
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13A.3 International Aspects96 |
13A.3.1 Scope (Part 2 Chapter 5) |
ITEPA charges tax by reference to a number of international factors. The consequence of this division will be that while payments for services in the UK will always be taxed here, payments for services outside the UK will be taxed either (a) in full as they arise, (b) not at all or (c) only when they are remitted to the UK. |
If the employee is resident and ordinarily resident in the UK, ITEPA starts by charging tax on the emoluments in full;97 but it applies a remittance basis to the chargeable overseas earnings.98 Chargeable overseas earnings arise if the person is not domiciled in the UK, the employment is with a foreign employer and the duties are performed wholly outside the UK.99 Sums deducted in calculating the chargeable overseas earnings cannot also be deducted under section 11 and its satellite rules.100 Where the employee has not only this employment but also an associated employment whose duties are performed wholly or partly inside the UK, a restriction may apply to prevent avoidance101 |
If a person is resident but not ordinarily resident in the UK for the year,102 general earnings for duties performed in the UK are taxed in full as are general earnings from overseas Crown employments.103 Foreign general earnings are taxed on a remittance basis.104 Non-general earnings, eg securities related income in part 7 have their own international rules.105 |