FTCR on the portion of US income tax that comes from capital gain

I am liable to CGT for the disposal of US property and would like to claim the Foreign Tax Credit Relief. However, the US capital gain tax is part of the income tax and is calculated on all income (including e.g. interest, dividends, capital gains). Since the US tax is related to different sources, how should I report it on form SA106, specifically box 37? For instance, I could: (a) determine the portion of the gain over the total income (say 90%), report 90% of the US income tax in box 37, and the remaining portion in the other boxes (dividends etc.); (b) allocate the US Standard Deduction and income tax brackets against my income as most favourable; since my other income falls within the US Standard Deduction, I can allocate 100% of my US tax against the gain, and so I would report all the US tax in box 37. Of the two, (b) maximises my FTCR, since my other income is below the UK Personal Allowance so I only pay UK tax on the capital gain. Your instructions and example clarify that I can allocate my UK allowances and reliefs to maximise FCTR, but I cannot tell if I can do this for the foreign tax too. So could you please confirm if I can use approach (b), or should I rather go with (a)?

Hi
You would need to use 'a' as relief for foreign tax can only be given against that particular source. as your income comprises of more than 1 source and different rates are applied, each source needs to have the correct US tax rate claimed against it.

Hi,

Foreign Tax Credit Relief can only be claimed as follows:  
                                                       
Interest at 0%.                                                                                                                                                                                                                                                            Dividends at 15%                                                                                                                                                                                                                                                    Capital gains, this would be the equivelant of what you paid in the USA up to the limit of any UK tax that is then charged.                                                                                Earnings, the same as capital gains.

Thank you.