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Posted Thu, 01 Sep 2022 15:06:19 GMT by user888
Dear HMRC Admins, Good day, and thank you for taking time to answer this question. Going through HMRC's "Check if you need to send a Self Assessment tax return" tool (https://www.gov.uk/check-if-you-need-tax-return). After the first few questions there is this question “Do you need to pay tax on any of the following?”. One of the “following” being “Income from outside the UK”. Where, in the applicable tax year, a person has some income from outside the UK and the person's total annual income does not exceed the annual personal allowance of £12,570 (applicable to foreign income, right?), there should be no tax to pay on any income (whether UK or foreign), right? Let's say the foreign income is some bank interests not exceeding the starting rate of £5,000 (basically there is no tax to be paid right?). Given that, should the answer to the question “Do you need to pay tax on … Income from outside the UK” be a “no" in this case? By choose the "no" answer (more precisely "none of these") in the HMRC tool, the tool would eventually come to the conclusion that there is no need to register for self-assessment (despite the person has some income outside the UK during the tax year). Is this correct? To frame the question the other way round, for a person having some foreign income during the tax year (say bank interests not exceeding the starting rate of £5,000), but whose total income does not exceed the annual personal allowance, does the person have to register for self-assessment solely because there is some foreign income (for which no tax is to be paid because the total income does not exceed the personal allowance)? Thanks again.
Posted Wed, 07 Sep 2022 11:49:35 GMT by HMRC Admin 20
Hi user888,

If your combine UK and foreign dividend income is below the threshold (if you are a basic rate taxpayer - £2000 or if you are a higher rate taxpayer - £1000) then the foreign dividend aspect would not meet SA criteria.  
It is the same for bank interest.  
Where the combined UK and foreign interest is below the thresholds (BR = £1000 and HR = £500) then SA criteria is not met.  
All other sources of foreign income would meet SA criteria.

Thank you.
Posted Wed, 07 Sep 2022 12:16:59 GMT by user888
Hi HMRC Admins, Thank you for the reply. What if the combined UK and foreign dividend income is above the dividend allowance of £2000, and the combined UK and foreign interest is above the PSA of £1000, BUT the total income is below the personal allowance of £12,570 (hence no tax to pay). Is SA still required in such a case? When you said all other sources of foreign income would meet SA criteria, does it mean that SA is required for all other sources of foreign income even if the total income for the person is below below the personal allowance of £12,570 (hence no tax to pay)? Thanks again.
Posted Mon, 12 Sep 2022 11:13:36 GMT by HMRC Admin 19
Hi,

Yes, a Self Assessment return is still required for both scenarios.

Thank you.

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