Deemed Domiciled

Hi, I am a UK resident from 2006-2007, So I am classed as deemed domicile from 2021-2022. My foreign income (interest from NRO & NRE account) is less than £2000. As per section 809D of ITA 2007, I will be on remittance basis automatically. Do I have to disclose my foreign income in the self-assessment return even if it's below £2000? Because as per deemed domicile rule 2017 Less than £2,000 unremitted foreign income or gains The new deemed domicile legislation at section 835BA (chapter 2 of part 14 of ITA 2007) doesn’t apply if you’ve used the remittance basis under the provisions of section 809D ITA 2007. However, you must ensure that unremitted foreign income and gains are under £2,000 for the relevant tax year before deciding if you’re not deemed domicile in the UK for Income Tax and Capital Gains Tax. As the remittance basis rule changing from April 2025, will that affect me going forward? Thanks in advance

Hi
When you are UK tax resiednt and you become deemed domiciled, then you can no longer use the remittance basis of taxation.  Instead you must move to the 'arising basis' and declare your world-wide income, whether it is remitted to the UK or not.  The is the default taxation method for all UK residents who are domiciled or deemed domiciled.  This means that from 2021 to 2022 onwards, you will be taxable on the arising basis and not the remittance basis.  The remittance basis changes that come into effect from 5 April 2025, will not matter, you will be taxable on the arising basis only.

But what about section 809D ITA 2007 which says that foreign income under £2000 will be automatically be on remittance basis. Deemed domicile legislation doesn't apply if section 809D is used.

Hi NK,
You need to submit a formal application for this.
Thank you. 

Can you please tell me how to apply.

Hi,

You need to write in saying that you are claiming the relief and specify the section you are referring to, as in the related query. This should be sent to:

HMRC,
PAYE & Self Assessment,
BX9 1AS

Thank you.