Section 648: Income arising under a settlement
2478.This section explains what is meant by income arising under a settlement. It is based on section 660G of ICTA.
2479.Subsection (1) includes all income chargeable to tax on a UK resident from sources within or outside the United Kingdom.
2480.Subsections (2) to (5) apply where the settlor is either not resident in the United Kingdom or not domiciled or not ordinarily resident here. In that case any foreign source income is excluded unless it is remitted to the United Kingdom and the settlor would be chargeable to tax in respect of it if it were his own income. In that case it is included in the income arising under a settlement in the year of remittance.
2481.The net effect of this section is to include all UK source income within income arising under a settlement but to exclude foreign source income if the settlor is non-UK resident. If the settlor would have been charged on an amount calculated by reference to section 832 (relevant foreign income charged on the remittance basis) had he or she been entitled to the income, then that foreign source income is charged only to the extent that it is remitted here.
