Test your understanding: answers
(1). All of Lark’s UK income will be subject to UK income tax because UK source income is always subject to UK income tax.
Lark’s overseas income will be subject to UK income tax because Lark is UK resident. The remittance basis will be available because Lark is neither domiciled nor deemed domiciled in the UK.
(2). Raven’s rental income in respect of the property situated in Twitcheria will not be subject to income tax in the UK because Raven is not resident in the UK.
(3). Statement A is false
Although Finch is resident but neither domiciled nor deemed domiciled in the UK, he must satisfy one of the following conditions in order to be able to claim the remittance basis.
- He must be non-UK resident for three consecutive tax years in the previous five tax years, or
- His income must be in respect of duties performed wholly abroad for an overseas employer.
Finch does not satisfy either of these conditions.
Statement B is true because Finch is resident but neither domiciled nor deemed domiciled in the UK.
