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Posted Sat, 27 Aug 2022 20:50:25 GMT by 9043583
One of the requirements to be eligible for “Foreign Workers’ Exemption” is for “your combined UK and foreign income is within the band for basic rate Income Tax". If an individual's combined income in the tax year was less than £12,570 (which is below the basic income tax band) I understand that their effective income tax band would be 0%. Would the individual still qualify for the “Foreign Workers’ Exemption” in this case?
Posted Tue, 06 Sep 2022 12:28:24 GMT by HMRC Admin 19
Hi,

To qualify for the foreign workers' exemption, all of the following have to apply:                            
  • your income from your overseas job is less than £10,000
  • your other foreign income (such as bank interest) is less than £100
  • all your foreign income has been subject to foreign tax (even if you did not have to pay, for example because of a tax-free allowance)
  • your combined UK and foreign income is within the band for basic rate Income Tax
  • you do not need to fill in a tax return for any other reason
You can see more information here:

Tax on foreign income

Thank you.
Posted Wed, 07 Sep 2022 08:13:27 GMT by 9043583
My question is regarding the fourth requirement: "your combined UK and foreign income is within the band for basic rate Income Tax" In a scenario whereby an individual's combined UK and foreign income in the tax year was less than £12,570 (which is below and therefore not within the basic income tax band), would the individual still qualify for the “Foreign Workers’ Exemption”?
Posted Mon, 12 Sep 2022 10:40:58 GMT by HMRC Admin 19
Hi,

You may still need to file a return, please refer to the guidance here:

Tax on foreign income

Thank you.
Posted Mon, 12 Sep 2022 20:18:16 GMT by 9043583
Thank you for your reply but that doesn't answer my question unfortunately. I would like to know if an individual is eligible to claim the Foreign Workers’ Exemption if that individual's combined UK and foreign income in the tax year is less than £12,570 (which is below the basic income tax band).
Posted Wed, 14 Sep 2022 09:59:08 GMT by HMRC Admin 17

Hi,
 
Yes this can be claimed but it appears that it is actually split year that is being applied for and this must be done in a
self assessment tax return - If you qualify for split year then you only report any foreign income for the UK part of the year :

Residence, Domicile and Remittance Basis Manual .

If you do not qualify then you will need to report all your foreign income to the UK :

Tax on foreign income  . 

The guidance at RDRM12150 at www.gov.uk will help you work out if split year treatment applies  .

Thank you.

 
Posted Wed, 14 Sep 2022 15:58:45 GMT by 9043583
Thank you for confirming that an individual can claim Foreign Workers’ Exemption if their combined UK and foreign income in the relevant tax year is less than £12,570. Does an individual need to complete a self assessment tax return to claim Foreign Workers’ Exemption or is it automatically applied? Please note that split year treatment is not being applied for in this case.
Posted Fri, 16 Sep 2022 12:03:57 GMT by HMRC Admin 20
Hi 9043583,

Yes, to claim foreign workers exemption, you need to complete SA106 (foreign) SA109 (Residence), along with SA100 (tax return)
and any other relevant supplementary pages.  

There is the online option to register for self assessment at: Register for Self Assessment or phone the self assessment helpline
on 0300 200 3310.

Thank you.

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