12.—(1) In these Regulations “foreign income” means income arising, in the year in question, from possessions or from securities out of the United Kingdom which is not—
(a)employment income;
(b)trading income; or
(c)investment income falling within regulation 10(1)(e).
This is subject to the following provisions of this regulation.
(2) The reference in paragraph (1) to income arising from or possessions or from securities out of the United Kingdom shall be construed in accordance with section 18(3B) of the Taxes Act M1.
(3) In calculating the claimant’s foreign income there shall be disregarded—
(a)any payment by way of an annuity or pension payable under any special provision for victims of National Socialist persecution which is made by the law of the Federal Republic of Germany, or any part of it, or of Austria;
(b)if the claimant’s foreign income comprises or includes a pension to which section 65(2) F1... of the Taxes Act applies [F2or to which sections 567(5) and 617 of ITEPA apply], the amount authorised to be deducted by [F3the relevant provision]; and
(c)any amount which would be disregarded for the purposes of income tax by virtue of—
(i)Extra Statutory Concession A10 (lumps sums paid by overseas pension schemes);
[F4(ii)section 681 of ITEPA;]
(iii)Extra Statutory Concession A30 (interest on damages for personal injuries awarded by a foreign court); or
(iv)Extra Statutory Concession A44 (education allowances payable to public officials of overseas territories).
[F5(4) Where an overseas property business (within the meaning of the Taxes Act) makes a loss to which the relief provisions of section 379A of the Taxes Act apply, by virtue of section 379B of that Act, then such relief as may arise under section 379A(1) shall be applied in calculating foreign income for the purposes of this regulation.]
Textual Amendments
F1Words in reg. 12(3)(b) omitted (6.4.2003) by virtue of The Tax Credits (Definition and Calculation of Income) (Amendment) Regulations 2003 (S.I. 2003/732), regs. 1, 10(a)(i)
F2Words in reg. 12(3)(b) inserted (6.4.2003) by The Tax Credits (Definition and Calculation of Income) (Amendment) Regulations 2003 (S.I. 2003/732), regs. 1, 10(a)(ii)
F3Words in reg. 12(3)(b) substituted (6.4.2003) by The Tax Credits (Definition and Calculation of Income) (Amendment) Regulations 2003 (S.I. 2003/732), regs. 1, 10(a)(iii)
F4Reg. 12(3)(c)(ii) substituted (6.4.2003) by The Tax Credits (Definition and Calculation of Income) (Amendment) Regulations 2003 (S.I. 2003/732), regs. 1, 10(b)
F5Reg. 12(4) added (26.11.2003) by The Tax Credits (Miscellaneous Amendments No.2) Regulations 2003 (S.I. 2003/2815), regs. 1, 10(1)
Marginal Citations
M1Subsections (3B) to (3E) were inserted by paragraph 4(3) of Schedule 7 to the Finance Act 1996.