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Where Taxpayers and Advisers Meet

Personal Allowance and split year treatment

Posts: 1
Joined: Fri Mar 22, 2019 8:53 pm

Personal Allowance and split year treatment

Postby Njmnjmnjm » Fri Mar 22, 2019 9:13 pm


I have registered for self assessment for some income I received during a split-year tax year during which I moved home to the UK from abroad. I was abroad for over two years as a student, but from the beginning of April I worked full-time for three months, living, working and paying tax in a country where I was resident (which has a taxation treaty with the UK so we don’t get double taxed).

I moved back around July and began work in September. The amount I earned in the UK and paid tax on (PAYE) was around £9000, below the personal allowance. I have to declare a few thousand I earned working freelance in August.

My question is, does the personal allowance count towards income from the UK only, i.e. the 9000 (taxed) plus the 3000 (so far untaxed), or will HMRC include the amount I earned and paid tax on abroad as part of my income for the whole year? From what I can tell, personal allowance is only on taxable income and my income abroad is not taxable because I was resident there, but split year treatment confuses things. For the whole year, my income would be around 17,000 so above the personal allowance if I were resident in the UK the whole time.


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Joined: Wed Aug 06, 2008 3:25 pm

Re: Personal Allowance and split year treatment

Postby maths » Sat Mar 23, 2019 6:51 pm

In the case of a split tax year, UK income tax only due on UK source income/earnings. Personal Allowance can then be set against such income (not against non-UK source income which is not subject to UK income tax).

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Joined: Wed Aug 02, 2017 9:09 pm

Re: Personal Allowance and split year treatment

Postby darthblingbling » Sun Mar 24, 2019 3:02 pm

Basically, take whatever income is taxable in the UK for the tax year:
  • For resident part of the year it'll likely be worldwide income
    For non resident part of the year it'll likely just be UK sourced income
Add together and take off your personal allowance.

Sounds like the income you earned overseas from April was earned while you were non-resident, but it will depend on the facts. LIkely it would not come into the equation above.

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