UK tax help

Life module — Double tax relief

These sheets are designed to analyse tax-relevant information related to relief against double taxation, which gives credit for tax charged in a non-U.K. jurisdiction.
Inserting
Double tax relief
 from the
Insert sheets
 menu brings in the following sheets:
Double tax relief — BLAGAB I-E
Use this sheet to review or adjust the calculated double tax relief (DTR) given against BLAGAB I-E profits.
Double tax relief — Other
Use this sheet to review or adjust the calculated DTR given against non-BLAGAB trade profits and LTBFC income.
DTR limitation details
Use this sheet to calculate the restriction of credit under section 96 Taxation (International and Other Provisions) Act 2010. You can also use it to calculate limitations on the credit for foreign tax under sections 100 and 101.

Completing the sheets

Double tax relief — BLAGAB I-E
This sheet is automated. Figures for calculating DTR are linked from the
Foreign non-trading income
 sheet. Items appear in the section of the sheet corresponding to the income category selection on the
Foreign non-trading income
 sheet.
BLAGAB I-E reliefs are deducted from the BLAGAB I-E income. Reliefs are allocated against non-foreign income first, then any remaining relief is allocated against the foreign income on a pro-rata basis. This represents the following reliefs:
  • Losses that can be offset against BLAGAB chargeable gains only (BLAGAB capital losses, non-BLAGAB capital losses and certain general annuity losses),
  • BLAGAB loan relationship deficits (both current period and any amounts brought back).
  • BLAGAB management expenses
  • In the case of a mutual society, qualifying donations that have been allocated against BLAGAB I-E profits on the
    Profits and gains computation
     sheet.
The resultant amounts are split into a policyholders’ share and a shareholders’ share (based on the percentage share of the total I-E profit). By default, reliefs against shareholders' profits (LTBFC management expenses and group relief for example) are allocated to the shareholders' share of each item of income.
HMRC manual LAM09030, however, implies that the allocation of reliefs for DTR purposes takes precedence over the rules in section 127 of Finance Act 2012 (No relief against policyholders’ share of I-E profit to be given for certain amounts). Therefore, you can allocate reliefs against total I-E profits by changing the
Automatically allocate reliefs against
 option.
There's a column for you to manually adjust the relief that has been allocated to specific items on the sheet.
Amounts of DTR are calculated automatically based on the net income attributable to each item and the amount of tax suffered in the U.K. and the foreign jurisdiction. Amounts of DTR are calculated individually for each item and are capped so they can't exceed the amount of U.K. tax payable on each item.
The total DTR calculated on this sheet is used on the
Tax calculation
 sheet as a deduction from tax due.
Double tax relief — Other
This sheet is automated. Figures for calculating DTR on non-BLAGAB trading income are linked from the
Foreign trading income summary
. Figures for calculating DTR on LTBFC income are linked from the
Foreign non-trading income
 sheet. The items appear in the section of the sheet corresponding to the income category selection given to the amount on the
Foreign non-trading income
 sheet.
There's a column for you to manually adjust the relief that has been allocated to specific items on the sheet.
Amounts of DTR are calculated automatically based on the net income attributable to each item and the amount of tax suffered in the U.K. and the foreign jurisdiction. Amounts of DTR are calculated individually for each item and are capped so they can't exceed the amount of U.K. tax payable on each item.
The total DTR calculated on this sheet is used on the
Tax calculation
 sheet as a deduction from tax due.
DTR limitation details
This sheet includes the calculation of
total income
 and
total relevant expenses
 in accordance with section 103 of the Taxation (International and Other Provisions) Act 2010, which you need to complete manually. These figures are used in the sections 100 and 101 limitations in the
Foreign trading income
 sheets.
The section 101 limitation also requires that business category profits, which are linked from the
Adjustment of profit
 sheets and, in the case of non-BLAGAB, are reduced by the amount of pre-1 April 17 trade losses. There is a data entry row for you to change the calculated figures manually, as section 101(3) could be interpreted as requiring other b/f BLAGAB and non-BLAGAB trade losses to be included.
If the
Non-BLAGAB overseas PE income
 sheet is present, the sheet also sets out the calculation of
Relevant UK-taxable profits
 and
Excess of receipts over expenses
 in accordance with section 96. These 2 figures are used to calculate a fraction that's used in the calculation of the shareholders’ share of foreign tax. You can replace this using a data entry row at the end of the sheet.

This article applies to:

  • PRODUCT: ONESOURCE Corporate Tax

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