Introduction Details of the Schedule
3.Paragraph 2 inserts new subsection (1A) into section 23. The effect of the new subsection is that a UK resident non-domiciled individual’s (P) overseas employment income will be taxed on the “arising” basis and not on the “remittance” basis if the new section 24A of ITEPA (inserted by paragraph 3) applies.
4.Paragraph 3 inserts new sections 24A and 24B into ITEPA.
5.New section 24A(1) and (2) set out when new section 24A will apply and provide a signpost to the provisions which set out the consequences. New section 24A(1) also defines the terms “relevant employment” and “relevant tax year”.
6.New section 24A(3) provides that PAYE will not apply to income taxed on the “arising” basis under new sections 23(1A), 41C(4A), 41H(5) and 554Z9(1A). Section 41H is inserted by section 52 of, and Schedule 9 to Finance Act 2014.
7.New section 24A(4) defines other terms used in this section.
8.New section 24A(5) sets out different types of employment income (certain overseas earnings, income relating to employment-related securities and securities options and employment income provided through third parties), in respect of a relevant employment. One or more of these paragraphs must apply, and conditions 1 to 4 must be met, (and condition 5 must not be met), for new section 24A to be engaged (see new section 24A(1)(a) to (c)).