Commentary on Sections Glossary Part 2: Employment income: charge to tax Section 42: Board to determine dispute as to domicile or ordinary residence
169.Subsection (1) introduces the purpose of the section. The phrase “is or has been” caters for the possibility that the dispute may relate to the person’s domicile or residence status in a tax year prior to the dispute arising.
170.Subsection (2) provides the means to start the process of reconciling a disagreement about the status of the employee. Either side can ask for reference to the Board of Inland Revenue. A ruling would then be issued giving the Board’s decision on the matter.
171.Subsection (3) lists the provisions which rewrite paragraph 1 of Schedule E – and section 192 of ICTA. In rewriting Schedule E a structure has been applied which uses residence, domicile and place of performance of duties to identify the basis of chargeability and year of charge. The term “foreign emoluments” is not used, nor an equivalent to that label, as used in section 192 of ICTA. Instead a full description of the status of employer and employee is given, which leads to certain earnings being excluded from chargeability. This subsection includes a list of all those provisions which rewrite or are dependent on “foreign emoluments” as well as those which rewrite the Cases of Schedule E. Three of the provisions based on section 192(1) of ICTA also contain a reference to “ordinary residence” which is not derived from that section, nor from paragraph 1 of Schedule E.
172.Disputes relating to all these provisions will now be covered by section 42. See Change 8 in Annex 1.