Commentary on Sections Overview Overview
3128.This Chapter provides relief from income tax if income arising in a territory outside the United Kingdom cannot be remitted to the United Kingdom. The Chapter also invokes the relevant charges outside Part 8 of this Act to withdraw relief if such income ceases to be unremittable. And it explains how unremittable income is to be valued where no claim is made for the relief. The relief applies only to income charged on the arising basis so does not apply to income charged on the remittance basis (Chapter 2 of this Part). The Chapter is based on section 584 of ICTA.
3129.The Chapter applies to “income arising in a territory outside the United Kingdom”. This is a wider term than relevant foreign income. So the relief may apply, for example, to some of the income charged in the source legislation under a non-schedular charge or under Schedule D Case VI. (Chapter 13 of Part 2 of this Act provides an equivalent relief in respect of unremittable receipts of a trade, profession or vocation. And section 272 (profits of a property business: application of trading income rules) applies that Chapter for the purposes of Part 3 of this Act.)
3130.The Chapter does not rewrite the appeal jurisdiction rules in section 584(9) of ICTA. An appeal on the application of the section may therefore be heard by General Commissioners (and the taxpayer retains the right to elect for a hearing by the Special Commissioners). See Change 142 in Annex 1. (But paragraph 153(3) and (4) of Schedule 2 to this Act preserve the rules in section 584(9) of ICTA if the appeal involves income that arose in a tax year before 2005-06.)
3131.Paragraph 153(1) and (2) of Schedule 2 to this Act ensure that the Chapter applies for 2005-06 and later tax years even though the income in question arose in an earlier tax year.