Part 2

Employment income: charge to tax
CHAPTER 5B

Taxable specific income from employment-related securities etc: internationally mobile employees

Section 41F: chargeable and unchargeable foreign securities income
41H
1
The extent to which the securities income is “chargeable foreign securities income” or “unchargeable foreign securities income” is to be determined as follows.
2
Treat an equal amount of the securities income as accruing on each day of the relevant period.
3
If any part of the relevant period is within a tax year to which subsection (4) applies, the securities income treated as accruing in that part of the relevant period is “chargeable foreign securities income”.
This is subject to subsection (9) and section 41I (limit where duties of associated employment performed in UK).
4
This subsection applies to a tax year if—
a
section 809B, 809D or 809E of ITA 2007
applied
to the individual for the year,
b
the individual
did not
meet the requirement of section 26A for the year (reading references there to the employee as references to the individual),
c
the relevant employment
was
with a foreign employer, and
d
the duties of the relevant employment
were
performed wholly outside the United Kingdom in the year.
5
But subsection (4) does not apply to a tax year if section 24A applies in relation to the relevant employment for the tax year.
6
If any part of the relevant period is within a tax year to which subsection (7) applies—
a
if the duties of the relevant employment are performed wholly outside the United Kingdom, the securities income treated as accruing in that part of the relevant period is “chargeable foreign securities income”, and
b
if some, but not all, of those duties are performed outside the United Kingdom—
i
the securities income mentioned in paragraph (a) is to be apportioned (on a just and reasonable basis) between duties performed in the United Kingdom and duties performed outside the United Kingdom, and
ii
the income apportioned in respect of duties performed outside the United Kingdom is “chargeable foreign securities income”.
This is subject to subsection (9).
7
This subsection applies to a tax year if—
a
section 809B, 809D or 809E of ITA 2007
applied
to the individual for the year,
b
the individual
met
the requirement of section 26A for the year (reading references there to the employee as references to the individual), and
c
some or all of the duties of the relevant employment
were
performed outside the United Kingdom in the year.
8
If any part of the relevant period is within a tax year for which the individual is not UK resident—
a
if the duties of the relevant employment are performed wholly outside the United Kingdom in that year, the securities income treated as accruing in that part of the relevant period is “unchargeable foreign securities income”, or
b
if some, but not all, of those duties are performed outside the United Kingdom in that year—
i
the securities income mentioned in paragraph (a) is to be apportioned (on a just and reasonable basis) between duties performed in the United Kingdom and duties performed outside the United Kingdom, and
ii
the income apportioned in respect of duties performed outside the United Kingdom is “unchargeable foreign securities income”.
9
If any part of the relevant period is within the overseas part of a tax year that is a split year with respect to the individual—
a
if the duties of the relevant employment are performed wholly outside the United Kingdom in that overseas part, the securities income treated as accruing in that part of the relevant period is “unchargeable foreign securities income”, or
b
if some, but not all, of those duties are performed outside the United Kingdom in that overseas part—
i
the securities income mentioned in paragraph (a) is to be apportioned (on a just and reasonable basis) between duties performed in the United Kingdom and duties performed outside the United Kingdom, and
ii
the income apportioned in respect of duties performed outside the United Kingdom is “unchargeable foreign securities income”.
10
If subsection (4) does not apply to a tax year by virtue of subsection (5), it is to be assumed for the purposes of section 41L that it is just and reasonable for none of the securities income treated as accruing in the tax year to be “chargeable foreign securities income”.
11
See section 41J for further provision about the location of employment duties.
12
This section is subject to—
a
section 41K (securities income from overseas Crown employment), and
b
section 41L (chargeable and unchargeable foreign securities income: just and reasonable apportionment).
Pt. 2 applied (E.W.S.) (31.3.2017) by The Equality Act 2010 (Specific Duties and Public Authorities) Regulations 2017 (S.I. 2017/353), reg. 1(1), Sch. 1 para. 4(3) (with reg. 2(4)(5))
Pt. 2 Ch. 5B substituted (with effect in accordance with Sch. 3 para. 7(3), Sch. 9 para. 48 of the amending Act) for Pt. 2 Ch. 5A by virtue of Finance Act 2014 (c. 26), Sch. 9 paras. 5, 47
Pt. 2 applied (with effect in accordance with s. 1329(1) of the amending Act) by Corporation Tax Act 2009 (c. 4), ss. 969(4)(a), 1329(1) (with Sch. 2 Pts. 1, 2)
Word in s. 41H(4)(a) substituted (for the tax year 2025-26 and subsequent tax years) by Finance Act 2025 (c. 8), s. 40(4), Sch. 9 para. 3(9)(a)(i)
Words in s. 41H(4)(b) substituted (for the tax year 2025-26 and subsequent tax years) by Finance Act 2025 (c. 8), s. 40(4), Sch. 9 para. 3(9)(a)(ii)
Word in s. 41H(4)(c) substituted (for the tax year 2025-26 and subsequent tax years) by Finance Act 2025 (c. 8), s. 40(4), Sch. 9 para. 3(9)(a)(iii)
Word in s. 41H(4)(d) substituted (for the tax year 2025-26 and subsequent tax years) by Finance Act 2025 (c. 8), s. 40(4), Sch. 9 para. 3(9)(a)(iv)
Word in s. 41H(7)(a) substituted (for the tax year 2025-26 and subsequent tax years) by Finance Act 2025 (c. 8), s. 40(4), Sch. 9 para. 3(9)(b)(i)
Word in s. 41H(7)(b) substituted (for the tax year 2025-26 and subsequent tax years) by Finance Act 2025 (c. 8), s. 40(4), Sch. 9 para. 3(9)(b)(ii)
Word in s. 41H(7)(c) substituted (for the tax year 2025-26 and subsequent tax years) by Finance Act 2025 (c. 8), s. 40(4), Sch. 9 para. 3(9)(b)(iii)