Finance Act 1977

4 (1) This paragraph has effect where a deduction falls to be allowed under the foregoing provisions of this Schedule in respect of the emoluments from an employment (" the relevant employment") for a year of assessment in which the duties of—

(a) the relevant employment; or

(b) any other employment or employments held by the person concerned which are associated with the relevant employment,

are not performed wholly outside the United Kingdom.

(2) The amount of the emoluments from the relevant employment in respect of which a deduction is allowed under paragraph 1 above for the year of assessment shall not exceed such proportion of the emoluments for that year from the relevant employment and the other employment or employments (if any) as is shown to be reasonable having regard to the nature of and time devoted to the duties performed outside and in the United Kingdom respectively and to all other relevant circumstances.

(3) The amount of the emoluments from the relevant employment in respect of which a deduction is allowed under paragraph 2 or 3 above for the year of assessment shall not exceed—

(a) the prescribed proportion of the emoluments for that year from the relevant employment and the other employment or employments (if any) ; or

(b) such larger proportion of those emoluments as is shown to be reasonable having regard to the matters mentioned in sub-paragraph (2) above.

(4) In sub-paragraph (3)(a) above "the prescribed proportion" means the proportion which—

(a) the number of days in the year of assessment which are shown to be qualifying days (as denned in paragraph 2(2) above) in relation to the relevant employment, bears to

(b) 365, or if there is a part of the year of assessment in which he holds neither the relevant employment nor any employment associated with it, 365 less the number of days in that part;

and where a day is a qualifying day in relation both to the relevant employment and one or more other employments that day shall, for the purposes of paragraph (a) above, count in relation to the relevant employment as the fraction arrived at by dividing the day equally between the different employments.

(5) For the purposes of this paragraph an employment is associated with another if they are with the same person or with persons associated with each other and—

(a) a company is associated with another company if one of them has control of the other within the meaning of section 302 of the Taxes Act or both of them are under the control within the meaning of that section of the same person or persons;

(b) an individual or partnership is associated with another person (whether or not a company) if one of them has control of the other within the meaning of section 534 of that Act or both are under the control within the meaning of that section of the same person or persons;

but paragraph (b) above shall not be construed as requiring an individual to be treated in any circumstances as under the control of another person.