ERSM162674 - International from 6 April 2015: ascertaining chargeable and unchargeable foreign securities income - from 6 April 2015: examples: example 4 - s26A employee with duties performed partly in the UK & partly overseas
In 2014/15 and 2015/16 Vivienne is resident but not domiciled in the UK, and meets the requirement of ITEPA03/S26A. She works for a UK affiliate of an overseas corporation but, during those years, spends 25% of each month on secondment abroad to the parent company. She is awarded a share option on 1 May 2014 which she exercises on the vesting date, which is 30 April 2015, realising a gain of 拢1,000. She claims the remittance basis of taxation under ITA07/S809B for both years.
All the conditions in ITEPA03/S41H(7) are met for 2014/15 and 2015/16.
The relevant period for the share option is from 1 May 2014 to 30 April 2015 and falls within 2014/15 and 2015/16.
As Vivienne has performed the duties of her employment partly in the UK and partly overseas during the relevant period the option gain is apportioned on a just and reasonable basis, in accordance with the split of the duties.
As a result, 拢750 is taxed in the UK on the arising basis in 2015/16.
The balance of 拢250 is treated as chargeable foreign securities income and will be taxed only if remitted to the UK.
For an explanation of the requirement of section 26A, see ERSM162677.