Are you paying unnecessary tax on foreign income?

UK taxpayers with income from overseas may not always be aware of the tax rules that apply.  Foreign income is defined as any income from outside England, Scotland, Wales and Northern Ireland. The Channel Islands and the Isle of Man are classed as foreign. Different rules may apply if you’re eligible for Foreign Income and Gains relief.

Foreign income can include wages from working abroad, overseas dividends and savings interest, rental income from foreign property, and pensions held outside the UK.

Whether UK tax is due depends mainly on your UK residence status. If you are not UK resident, you will not usually pay UK tax on your foreign income. However, UK residents will generally need to pay tax on worldwide income unless a specific exemption or relief applies.

Since 6 April 2025, changes to the rules affecting individuals who previously relied on their overseas domicile status mean that some people may need to review how their foreign income and gains are taxed. Eligible individuals may be able to claim Foreign Income and Gains (FIG) relief, depending on their circumstances.

Foreign income that is taxable in the UK is normally reported through a self-assessment tax return, although some types of income have different rules.

If the same income is taxed in both the UK and another country, you may be able to claim relief to prevent double taxation. In some cases, you may need a certificate of residence from HMRC to confirm your entitlement to relief.

Source:HM Revenue & Customs | 03-08-2026
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Aitch
I'm Aitch, the Founder and CEO of CIGMA Accounting Ltd. As a Chartered Management Accountant and as a CIMA member, I've spent more than 16 years helping businesses, entrepreneurs, landlords, and individuals with tax planning, accounting, and HMRC compliance. As a chartered accountant in London, I'm passionate about making complex tax matters easier to understand and helping clients make confident financial decisions. Over the years, I've advised start-ups, SMEs, established companies, and high-net-worth individuals across a wide range of tax and accounting matters. My expertise includes Corporation Tax, Self-Assessment, Capital Gains Tax, Inheritance Tax planning, R&D tax relief, capital allowances, international tax, and resolving complex HMRC compliance issues. Whether clients need a business accountant, tax accountant, or strategic tax advisor, my focus is always on delivering practical advice that creates long-term value. One of my specialist areas is Making Tax Digital (MTD). I've worked extensively with businesses preparing HMRC's digital reporting requirements, helping them move to cloud accounting, improve financial processes, and adopt technology that makes compliance more efficient. I regularly speak at Making Tax Digital roadshows, industry events, and educational sessions in collaboration with Zoho Books, sharing practical insights into digital accounting, tax legislation, and the future of the profession. Many business owners looking for the best accounting firm in London are not simply searching for an accountant they're looking for trusted advice, responsive support, and long-term value. That's the approach I've taken in building CIGMA Accounting. My team and I work closely with businesses across London and the UK, providing accounting services, tax advisory, bookkeeping, payroll, VAT, company accounts, and strategic tax planning tailored to each client's goals. Through this website, I share practical guidance on UK taxation, Making Tax Digital, HMRC updates, Corporation Tax, Self-Assessment, and business finance. My aim is to provide reliable, straightforward information that helps business owners understand changing regulations, reduce compliance risks, and make informed financial decisions with confidence.