Part 2

Employment income: charge to tax
Chapter 5C

Relief for new residents on foreign employment income

Foreign employment election

Foreign employment election for qualifying new residents
41M
1
This Chapter applies if an individual is a qualifying new resident for a tax year (the “qualifying year”).
2
An individual is a qualifying new resident for a tax year for the purposes of this Chapter if the individual is a qualifying new resident for the tax year for the purposes of Chapter 5 of Part 8 of ITTOIA 2005 (see section 845B of that Act).
3
The individual may make an election for the qualifying year under this section (“a foreign employment election”).
4
Section 41P makes provision about a claim for relief—
a
which an individual can make for the qualifying year or any subsequent tax year, where the individual has made a foreign employment election, and
b
which entitles the individual to relief in that year calculated by reference to employment income that is in respect of the qualifying year.
5
Sections 41Q (amount of relief available) and 41R (limit on relief) set out how to determine the amount of relief to which the individual is entitled.
6
See also—
a
sections 845C to 845E of ITTOIA 2005, which set out some income tax consequences of a foreign employment election, and
b
section 1K of TCGA 1992, which provides for the loss of the individual’s annual exempt amount for capital gains tax where a foreign employment election is made.
7
A foreign employment election must be made in a return.
8
A foreign employment election for the qualifying year must be made before the end of the period of 12 months beginning with 31 January after the end of the qualifying year.
9
A foreign employment election may not be made as a consequential claim (within the meaning of section 43C(5) of TMA 1970) if the circumstances which give rise to the consequential claim result from a loss of tax brought about carelessly or deliberately by the individual or a person acting on the individual’s behalf.
10
For the purposes of this Chapter—
a
“
return
” means a return under section 8 of TMA 1970 (personal return),
b
references to a claim or election being included in a return include a claim or election being so included as a result of an amendment of the return, and
c
subsections (5) to (7) of section 118 of TMA 1970 (loss of tax brought about carelessly or deliberately) apply as they apply for the purposes of that Act.
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 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)
Pt. 2 Ch. 5C inserted (20.3.2025 for the tax year 2025-26 and subsequent tax years) by Finance Act 2025 (c. 8), s. 38(1)(3) (with Sch. 8 Pt. 3)