Finance (No. 2) Bill (HC Bill 154)

“(1) This section applies to foreign chargeable gains accruing to an
individual in a tax year (“the foreign chargeable gains”) if section

809B, 809D or 809E of ITA 2007 (remittance basis) applies to the
individual for that year.”

18 In section 87B of that Act (section 87: remittance basis), in subsection (1)—

(a) insert “and” at the end of paragraph (a),

(b) 5omit “and” at the end of paragraph (b), and

(c) omit paragraph (c).

19 In section 726 of ITA 2007 (non-UK domiciled individuals to whom
remittance basis applies), for subsection (1) substitute—

“(1) This section applies in relation to income treated under section 721 as
10arising to an individual in a tax year (“the deemed income”) if section
809B, 809D or 809E (remittance basis) applies to the individual for
that year.”

20 In section 730 of that Act (non-UK domiciled individuals to whom
remittance basis applies), for subsection (1) substitute—

“(1) 15This section applies in relation to income treated under section 728 as
arising to an individual in a tax year (“the deemed income”) if section
809B, 809D or 809E (remittance basis) applies to the individual for
that year.”

21 In section 735 of that Act (non-UK domiciled individuals to whom
20remittance basis applies), for subsection (1) substitute—

“(1) This section applies in relation to income treated under section 732 as
arising to an individual in a tax year (“the deemed income”) if section
809B, 809D or 809E (remittance basis) applies to the individual for
that year.”

22 25In section 809F of that Act (effect on what is chargeable), in subsection (4),
for “If the individual is not domiciled in the United Kingdom in that year,
the” substitute “The”.

23 In section 809YD of that Act (chargeable gains accruing on sales of exempt
property), in subsection (3), omit “and P is not domiciled in the United
30Kingdom in that year”.

24 In section 809Z7 of that Act (meaning of “foreign income and gains” etc)—

(a) in subsection (2)(d), omit “if the individual is not domiciled in the
United Kingdom in that year,”, and

(b) in subsection (3)(a), for “is ordinarily UK resident in” substitute
35“does not meet the requirement of section 26A of ITEPA 2003 for”.

Commencement

25 The amendments made by this Part of this Schedule have effect in relation
to an individual’s foreign income and gains for the tax year 2013-14 or any
subsequent tax year.

40Savings

26 (1) This paragraph applies to an individual who—

(a) was not resident in the United Kingdom for the tax year 2009-10,

(b) is resident there for the tax year 2012-13, but

(c) is not ordinarily resident there at the end of the tax year 2012-13.

(2) Enactments relating to income tax or capital gains tax have effect, in relation
to any eligible foreign income and gains of the individual, as if the
amendments made by this Part of this Schedule had not been made.

(3) 5“Eligible foreign income and gains” means—

(a) if the individual was resident in the United Kingdom for the tax year
2010-11 and the tax year 2011-12, foreign income and gains for the tax
year 2013-14,

(b) if the individual was not resident in the United Kingdom for the tax
10year 2010-11 but was resident in the United Kingdom for the tax year
2011-12, foreign income and gains for the tax year 2013-14 and the tax
year 2014-15, and

(c) if the individual was not resident in the United Kingdom for the tax
year 2011-12, foreign income and gains for the tax year 2013-14, the
15tax year 2014-15 and the tax year 2015-16.

(4) Where, by virtue of this paragraph, it is necessary to determine whether an
individual is (or is not) ordinarily resident in the United Kingdom at a time
on or after 6 April 2013, the question is to be determined as it would have
been in the absence of this Schedule.

20Interpretation

27 References in this Part of this Schedule to an individual’s “foreign income
and gains” for a tax year are to be read in accordance with section 809Z7 of
ITA 2007 (interpretation of remittance basis rules).

Part 2 25Income tax: arising basis of taxation

ICTA

28 In section 614 of ICTA (exemptions and reliefs in respect of income from
investments etc of certain pension schemes)—

(a) in subsection (4), for “not domiciled, ordinarily resident or resident”
30substitute “not domiciled and not resident”, and

(b) in subsection (5), for “not domiciled, ordinarily resident or resident”
substitute “not domiciled and not resident”.

ITEPA 2003

29 ITEPA 2003 is amended as follows.

30 35In section 56 (application of Income Tax Acts in relation to deemed
employment), in subsection (5)—

(a) for paragraph (a) substitute—

“(a) the worker being resident or domiciled outside the
United Kingdom or meeting the requirement of
40section 26A,”, and

(b) in paragraph (b), omit “or ordinarily resident”.

31 In section 61G (application of Income Tax Acts in relation to deemed
employment), in subsection (5)—

(a) for paragraph (a) substitute—

“(a) the worker being resident or domiciled outside the
5United Kingdom or meeting the requirement of
section 26A,”, and

(b) in paragraph (b), omit “or ordinarily resident”.

32 In section 328 (the income from which deductions may be made), in
subsection (5), omit the entry for Chapter 6 of Part 5 and the word “and”
10immediately preceding it.

33 In section 341 (travel at start or finish of overseas employment), in
subsection (3), for “resident and ordinarily resident in the United Kingdom”
substitute “UK resident”.

34 In section 342 (travel between employments where duties performed
15abroad), in subsection (6), for “resident and ordinarily resident in the United
Kingdom” substitute “UK resident”.

35 In section 370 (travel costs where duties performed abroad: employee’s
travel), in subsection (6), omit “in which the employee is ordinarily UK
resident”.

36 20In section 376 (foreign accommodation and subsistence costs and expenses
(overseas employments)), in subsection (1)(b), for “resident and ordinarily
resident in the United Kingdom” substitute “UK resident”.

37 (1) Section 378 (deductions from seafarers’ earnings: eligibility) is amended as
follows.

(2) 25In subsection (1), for “relevant taxable earnings or EEA-resident earnings”
substitute “relevant general earnings”.

(3) For subsection (5) substitute—

“(5) Relevant general earnings” means—

(a) taxable earnings under section 15, 22 or 26, or

(b) 30general earnings—

(i) to which section 27 applies, and

(ii) which are for a period in which the employee is liable
under the law of an EEA State (other than the United
Kingdom) to tax in that State by reason of domicile or
35residence.”

(4) Omit subsection (6).

38 In section 413 (exception in certain cases of foreign service), in subsection
(3A), before paragraph (a) insert—

“(za) for service in or after the tax year 2013-14, earnings for a tax
40year that are earnings to which section 15 applies and to
which that section would apply even if the employee made a
claim under section 809B of ITA 2007 (claim for remittance
basis) for that year,”.

39 (1) In section 681A (foreign benefits of consular employees), for subsection (4)