From 6 April 2014 there are new rules on Dual Employment contracts to prevent avoidance by remittance basis users.

The new rules will tax the overseas earnings as income arising in the UK instead of as overseas earnings on which the remittance basis can be claimed provided that all of the following rules apply:

  • The individual holds a UK employment
  • The UK employer is the same as or is associated with the overseas employer
  • The two employments are related
  • The foreign tax rate applicable to income from the overseas employment is less than 65% of the UK’s highest marginal rate of income tax.

Foreign tax borne on the overseas' income will reduce the employee’s UK tax liability.

The rules exclude directors who control less than 5% of share capital, arrangements which are not set up for tax avoidance purposes and where appointments are held for regulatory or legal purposes, also where overseas workday relief is available.


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