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Where Conditions A and B of section 809L ITA 2007 apply:

If the property that is brought to or used in the UK is the foreign income or chargeable gains, the taxable amount is the amount brought to, received or used in the UK (section 809P(2) ITA 2007). Refer to RDRM33140 Condition B - direct remittances of income or gains.

If the service or consideration for the service provided in the UK is the foreign income or chargeable gains, the taxable amount is the amount of the service, or used as consideration for the service. In practice it will be very rare for the service provided to actually 鈥榖e鈥� the foreign income or gains, so these chapters deal only with consideration for the service.

The most common taxable remittances of this kind occur where cash money is brought to the UK or an electronic transfer of funds to a UK bank account is made; the amount of the remittance is the amount of the cash or transfer that equals the foreign income or chargeable gains.

Where money is remitted, the taxable amount is the value of that money. Where the money is in a foreign currency (refer to RDRM31190 Exchange rates) the taxable amount is the pounds sterling value of the foreign currency.

Example 1

Frederick is a remittance basis user (refer to the earlier examples). His foreign employment income is paid directly by his employer into his Austrian bank account. Frederick鈥檚 wife Freda uses a cash machine in Edinburgh to withdraw 拢400 from that account to purchase some textbooks. Here the property remitted (the cash) is the foreign income; the amount remitted is 拢400.

Frederick鈥檚 wife later uses a debit card from the Austrian bank account to purchase more textbooks for 拢200 from Edinburgh鈥檚 bookstores. Again the property remitted is the foreign income and the amount remitted is 拢200.

Example 2

During tax year 2009-2010 Olivia, a remittance basis user, pays 拢8,000 of her relevant foreign income directly into her Jersey account. In the following tax year she transfers 拢6,000 of this into her UK bank account. The property remitted is the foreign income and the amount remitted is 拢6,000.

Example 3

Francine, a remittance basis user, has some extension work done on her house in Brighton by Paulo, a specialist contractor from Spain (refer to the earlier examples). This is a service provided in the UK. The invoice from Paulo totals 拢40,000.

Francine has 拢20,000 in her French bank account, which consists entirely of her relevant foreign income. Francine pays all of this money to Paulo鈥檚 overseas account. The remainder of the invoice is settled by Francine using her UK employment income.

The amount of the taxable remittance is 拢20,000 as the 鈥檆onsideration鈥� (the payment by Francine) for the service (Paulo鈥檚 building work) is, in part (拢20,000 out of the 拢40,000 total), Francine鈥檚 foreign income.

Example 4

Henri, a remittance basis user, gives 拢1,200,000 of foreign chargeable gains to a non-resident trust of which he and other 鈥榬elevant persons鈥� are beneficiaries.

The trustees (relevant persons) then purchase a UK house for 拢1,200,000 in which Henri and his family live. The amount of the remittance is equal to the amount of gains used that is 拢1,200,000.