Income Tax (Earnings and Pensions) Act 2003 section 554Z11A

Temporary non-residents

Section 554Z11A deals with the tax treatment of lump sum benefits from employer-financed retirement schemes that are remitted to the United Kingdom during a period of temporary non-residence, ensuring that such amounts cannot escape a UK tax charge simply because the individual was abroad when the remittance occurred.

• Where an individual is temporarily non-resident and remits a lump sum retirement benefit to the UK during that absence, the amount is treated as though it were remitted in the tax year of their return to the UK
• The section catches amounts that would have been taxable under the remittance basis rules but for the protection of a double taxation agreement, including cases where a double taxation relief claim could have been made but was not
• Double taxation agreements cannot be relied upon to prevent a UK income tax charge on amounts deemed remitted under this section in the period of return
• The concepts of temporary non-residence, the temporary period of non-residence, and the period of return are defined by reference to the statutory residence test in Schedule 45 to Finance Act 2013