Certain deductions and reliefs may be taken into account in the calculation of relevant foreign income charged on the arising basis. The reliefs, which are set out in ITTOIA 2005, ss 838–840A (Pt 8, Ch 3), are limited in scope.
Expenses attributable to the collection or payment of relevant foreign income
In calculating the amount of relevant foreign income that is charged to income tax for a year, a deduction is allowed for expenses incurred outside the UK that are attributable to the collection or payment of the income1. The deduction is only available where the relevant foreign income is charged to tax on the arising basis and not where the charge is on the remittance basis2.
Annual payments payable out of relevant foreign income
A deduction is available in calculating relevant foreign income charged to tax for a tax year, for a relevant annual payment other than interest, that meets conditions A, B1 or B2, and C3. The deduction is only available where the relevant foreign income
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