http://www.legislation.gov.uk/ukpga/2005/5/section/23KIncome Tax (Trading and Other Income) Act 2005An Act to restate, with minor changes, certain enactments relating to income tax on trading income, property income, savings and investment income and certain other income; and for connected purposes.texttext/xmlenStatute Law Database2026-07-30Expert Participation2026-07-15 Income Tax (Trading and Other Income) Act 2005s. 168(6)(e) and wordPlanning (Consequential Provisions) (Wales) Act 2026Deddf Cynllunio (Darpariaethau Canlyniadol) (Cymru) 2026Sch. 2 para. 370(b)Sch. 5 Pt. 1s. 5(2) Part 2Chapter 223K1An individual who is treated as carrying on a trade for a tax year under section 23I is treated as carrying on the trade—awholly in the United Kingdom, if all of the applicable workdays are UK workdays;bwholly outside the United Kingdom, if all of the applicable workdays are not UK workdays;cotherwise, partly in the United Kingdom and partly outside the United Kingdom.2Where the trade is treated as carried on partly in the United Kingdom and partly outside the United Kingdom, the amount to be treated as the profits arising from the part of the trade treated as carried on in the United Kingdom is the sum of the non-qualifying profits of that part of the trade and 72.5% of the qualifying profits of that part of the trade.3In subsection (2)—athe amount of the non-qualifying profits of the part of the trade treated as carried on in the United Kingdom is the proportion of the non-qualifying profits of the trade (determined in accordance with section 23I(3)(a)) that is the same as the proportion of the applicable workdays that are UK workdays (but see subsection (4));bthe amount of the qualifying profits of the part of the trade treated as carried on in the United Kingdom is the proportion of the qualifying profits of the trade (determined in accordance with section 23I(3)(b)) that is the same as the proportion of the applicable workdays that are UK workdays (but see subsection (5)).4For the purposes of subsection (3)(a) in a case where—athe individual is a non-UK resident for the tax year, andbany of the non-qualifying profits of the trade are anticipated qualifying profits,any UK workday in a non-UK tax year is not to be treated as a UK workday (but remains an applicable workday) for the purposes of determining the proportion of the anticipated qualifying profits that is an amount of non-qualifying profits of the part of the trade treated as carried on in the United Kingdom.5For the purposes of subsection (3)(b) in a case where the individual is a non-UK resident for the tax year, the following days are not to be treated as UK workdays (but remain applicable workdays)—aany UK workday prior to 30 October 2024;bany UK workday in a non-UK tax year;cany UK workday prior to a period of 3 or more non-UK tax years.6For the purposes of this section—aa day is an “applicable workday” if it is a day in the relevant period on which the individual performs any investment management services directly or indirectly in respect of an investment scheme (whether or not under the arrangements mentioned in section 23I(1)(a));ba day is a “UK workday” if it is a day in the relevant period on which the individual spends more than 3 hours performing any investment management services directly or indirectly in respect of an investment scheme (whether or not under those arrangements) in the United Kingdom;ca year is a “non-UK tax year” if the individual is a non-UK resident for the tax year and there are fewer than 60 UK workdays in the year;dnon-qualifying profits are “anticipated qualifying profits” if, on the first UK workday in the relevant period, it was reasonable to assume that they would be qualifying profits.7For the purposes of subsection (6) the “relevant period” is the period—abeginning with the later of—ithe day on which the first external investor was admitted to any scheme from which the individual is entitled to carried interest under the arrangements mentioned in section 23I(1)(a), andiithe first day on which the individual performs any investment management services directly or indirectly in respect of an investment scheme under the arrangements;bending with the earlier of—ithe last day in the tax year for which the individual was treated as carrying on the trade under section 23I on which a sum of carried interest arose to the individual from an investment scheme under the arrangements for the purposes of that section, andiithe last day on which the individual performed any investment management services directly or indirectly in respect of an investment scheme under the arrangements.8For the purposes of subsection (6)—ainvestment management services performed by an individual in the course of travelling to or from the United Kingdom by air or sea or via a tunnel under the sea are assumed to be performed overseas even during the part of the journey in or over the United Kingdom, andbtravelling to or from the United Kingdom is taken to—ibegin when the individual boards the aircraft, ship or train that is bound for a destination in the United Kingdom or (as the case may be) overseas, andiiend when the individual disembarks from that aircraft, ship or train.Ss. 23I-23R and cross-heading inserted (for the tax year 2026-27 and subsequent tax years (but in relation to investment management services whenever performed)) by Finance Act 2026 (c. 11), s. 58(2)(6)