(7) Part 4 of Schedule 43 to FA 2013 (statutory residence test: anti-
avoidance) explains—

(a) 5when an individual is to be regarded as “temporarily non-
resident”, and

(b) what “the temporary period of non-residence” and “the
period of return” mean.

(8) In this section—

• 10“double taxation relief arrangements” means arrangements that
  have effect under section 2(1) of TIOPA 2010;

• “DTR claim” means a claim for relief under section 6 of that
  Act.”

124 In Chapter 2 of Part 7A (employment income provided through third
15parties: treatment of relevant step for income tax purposes), after section
554Z4 insert—

“554Z4Z4A Temporary non-residents

(1) This section applies if A is temporarily non-resident.

(2) Any relevant step within subsection (3) is to be treated for the
20purposes of section 554Z2 as if it were taken in the period of return.

(3) A relevant step is within this subsection if—

(a) it is the payment of a lump sum to a relevant person (see
section 554C(2)),

(b) the lump sum is a relevant benefit provided under a relevant
25scheme,

(c) the step is taken in the temporary period of non-residence,
and

(d) ignoring this section—

(i) no charge to tax arises by virtue of section 554Z2 by
30reason of the step, but

(ii) such a charge would arise if the existence of any
double taxation relief arrangements were
disregarded.

(4) Subsection (3)(d)(i) includes a case where the charge could be
35prevented by making a DTR claim, even if no claim is in fact made.

(5) Nothing in any double taxation relief arrangements is to be read as
preventing A from being chargeable to income tax in respect of any
relevant step treated by virtue of this section as taken in the period
of return (or as preventing a charge to that tax from arising as a
40result).

(6) Part 4 of Schedule 43 to FA 2013 (statutory residence test: anti-
avoidance) explains—

(a) when an individual is to be regarded as “temporarily non-
resident”, and

(b) 45what “the temporary period of non-residence” and “the
period of return” mean.

(7) In this section—

• “double taxation relief arrangements” means arrangements that
  have effect under section 2(1) of TIOPA 2010;

• “DTR claim” means a claim for relief under section 6 of that Act;

• 5“relevant benefit” has the same meaning as in Chapter 2 of Part
  6;

• “relevant scheme” means an employee-financed retirement
  benefits scheme (within the meaning of that Chapter) or a
  superannuation fund to which section 615(3) of ICTA
  10applies.”

125 In that Chapter, after section 554Z11 insert—

“554Z11A Temporary non-residents

(1) This section applies if A is temporarily non-resident.

(2) Any amount within subsection (3) is to be treated for the purposes of
15section 554Z9(2) or (as the case may be) 554Z10(2) as if it were
remitted to the United Kingdom in the period of return.

(3) An amount is within this subsection if—

(a) it is all or part of a relevant benefit provided to a relevant
person (see section 554C(2)) under a relevant scheme,

(b) 20it is provided in the form of the lump sum,

(c) it is remitted to the United Kingdom in the temporary period
of non-residence, and

(d) ignoring this section—

(i) no charge to tax arises by virtue of section 554Z9(2) or
25554Z10(2) in respect of it, but

(ii) such a charge would arise by virtue of one of those
sections if the existence of any double taxation relief
arrangements were disregarded.

(4) Subsection (3)(d)(i) includes a case where the charge could be
30prevented by making a DTR claim, even if no claim is in fact made.

(5) Nothing in any double taxation relief arrangements is to be read as
preventing A from being chargeable to income tax in respect of any
income treated by virtue of this section as remitted to the United
Kingdom in the period of return (or as preventing a charge to that tax
35from arising as a result).

(6) Part 4 of Schedule 43 to FA 2013 (statutory residence test: anti-
avoidance) explains—

(a) when an individual is to be regarded as “temporarily non-
resident”, and

(b) 40what “the temporary period of non-residence” and “the
period of return” mean.

(7) In this section—

• “double taxation relief arrangements” means arrangements that
  have effect under section 2(1) of TIOPA 2010;

• 45“DTR claim” means a claim for relief under section 6 of that Act;

• “relevant benefit” has the same meaning as in Chapter 2 of Part
  6;

Finance (No. 2) BillPage 538

• “relevant scheme” means an employee-financed retirement
  benefits scheme (within the meaning of that Chapter) or a
  superannuation fund to which section 615(3) of ICTA applies;

• “remitted to the United Kingdom” has the same meaning as in
  5Chapter A1 of Part 14 of ITA 2007.”

126 In that Chapter, in section 554Z12 (relevant step taken after A’s death etc),
after subsection (8) insert—

“(9) Section 554Z4A and section 554Z11A apply for the purposes of
subsection (4) as for the purposes of section 554Z2 and section
10554Z9(2) or 554Z10(2) respectively (reading references in sections
554Z4A and 554Z11A to “A” as references to “the relevant person”).

(10) But those sections do not apply for the purposes of subsection (4) if
the relevant person’s temporary period of non-residence began
before A died.”

127 15In Chapter 3 of Part 9 (United Kingdom pensions: general rules), after
section 572 insert—

“572A Temporary non-residents

(1) This section applies if an individual is temporarily non-resident.

(2) Any pension within subsection (3) is to be treated for the purposes of
20section 571 as if it accrued in the period of return.

(3) A pension is within this subsection if—

(a) section 569 applies to it,

(b) it is in the form of a lump sum,

(c) it accrued in the temporary period of non-residence, and

(d) 25ignoring this section—

(i) it is not chargeable to tax under this Chapter, but

(ii) it would be so chargeable if the existence of any
double taxation relief arrangements were
disregarded.

(4) 30Subsection (3)(d)(i) includes a case where the charge could be
prevented by making a DTR claim, even if no claim is in fact made.

(5) Nothing in any double taxation relief arrangements is to be read as
preventing the individual from being chargeable to income tax in
respect of any pension treated by virtue of this section as accruing in
35the period of return (or as preventing a charge to that tax from
arising as a result).

(6) Part 4 of Schedule 43 to FA 2013 (statutory residence test: anti-
avoidance) explains—

(a) when an individual is to be regarded as “temporarily non-
40resident”, and

(b) what “the temporary period of non-residence” and “the
period of return” mean.

(7) In this section—

• “double taxation relief arrangements” means arrangements that
  45have effect under section 2(1) of TIOPA 2010;

Finance (No. 2) BillPage 539

• “DTR claim” means a claim for relief under section 6 of that
  Act.”

128 (1) In Chapter 1 of Part 11 (pay as you earn: introduction), section 683 is
amended as follows.

(2) 5After subsection (3) insert—

“(3ZA) PAYE employment income” for a tax year does not include any
taxable specific income treated as paid or received in that tax year by
section 394A or 554Z4A (temporary non-residents).”

(3) For subsection (3B) substitute—

“(3B) 10PAYE pension income” for a tax year does not include any taxable
pension income that is treated as accruing in that tax year by section
572A or 579CA (temporary non-residents).”

New special rule: distributions to participators in close companies etc

129 Part 4 of ITTOIA 2005 (savings and investment income) is amended as
15follows.

130 In Chapter 1 (introduction), after section 368 insert—

“368A Interpretation of special rules for temporary non-residents

(1) This section concerns provisions of this Part that are expressed to
apply if an individual is “temporarily non-resident” (“TNR
20provisions”).

(2) Part 4 of Schedule 43 to FA 2013 (statutory residence test: anti-
avoidance) explains for the purposes of TNR provisions—

(a) when an individual is to be regarded as “temporarily non-
resident”, and

(b) 25what the following terms mean—

(i) “the temporary period of non-residence”,

(ii) “the year of departure”, and

(iii) “the period of return”.

(3) A reference in TNR provisions to “the year of return” is to the tax
30year consisting of or including the period of return.

(4) Nothing in any double taxation relief arrangements is to be read as
preventing the individual from being chargeable to income tax by
virtue of any TNR provisions (or as preventing a charge to that tax
from arising as a result).

(5) 35In this section and in TNR provisions, “double taxation relief
arrangements” means arrangements that have effect under section
2(1) of TIOPA 2010.”

131 In Chapter 3 (dividends etc from UK resident companies and tax credits etc