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Posted Mon, 24 Apr 2023 15:48:20 GMT by Pedro
Hello, I was self-employed in the UK in 2021-2022 and for part of 2022-2023. I moved to the US at the start of the 22/23 tax year and thus I am non-resident for 22/23. I need help understanding what part of my 22/23 income needs to be declared in my self-assessment. For example, does "UK-sourced income" include my revenue as self-employed even if the contracting company was a foreign company? If so, does the cash basis system apply? That is, should I report only what was paid to me while I was in the UK? or everything referring to self-employment regardless of my residence when I was paid? Furthermore, I paid US taxes on the aforementioned income. Under the UK-US tax agreement does that mean I should not be taxed in the UK? or that I need to fill out the tax relief section? Thank you and best regards.
Posted Wed, 03 May 2023 08:09:38 GMT by HMRC Admin 19

If you qualify for split year then you only report any foreign income for the UK part of the year. You can see guidance here:

RDRM12000 - Residence: The SRT: Split year treatment: Contents

If you do not qualify then you will need to report all your foreign income to the UK. You can see more information here:

Tax on foreign income

The following guidance will help you work out if split year treatment applies:

RDRM12150 - Residence: The SRT: Split year treatment: Case 4: Starting to have a home in the UK only 

Thank you.
Posted Fri, 12 May 2023 00:36:45 GMT by Pedro
Hi, Thank you for replying, I've been trying to understand RDRM but I think it doesnt apply to my case because I was not resident in the UK. Could you point me to a definition of UK-sourced income? I need to understand what part of my income while self employed in the UK for a foreign country needs to be declared. Thank you and best regards.
Posted Thu, 18 May 2023 16:35:20 GMT by HMRC Admin 10
The term 'source of income' describes where income arises or where it is derived from.
Income arising in the UK has a UK source and income arising outside the UK has a non-UK source (or foreign source).
Posted Fri, 19 May 2023 15:03:13 GMT by Pedro
Hi, Thank you, I understand the literal meaning but don't know how to apply it. I was self-employed in the UK but had clients in a foreign country. Is this arising in the UK or outside? Best regards
Posted Wed, 24 May 2023 14:27:03 GMT by HMRC Admin 5
Hi Pedro,

This is in the UK for the period you were here.

Thank you.

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