Foreign Income

Three questions to ask yourself

Earning abroad sounds complicated, but it comes down to three things. Work through them in order:

Were you a UK resident this tax year?

This is the big one. Check using our residency guide.

• UK resident → you declare your worldwide income, not just what you earned in the UK.
• Non-resident → you only declare income from work done in the UK.

Did you pay foreign tax on it?

No foreign tax paid? Treat it like any other income — employed income in the employment section, self-employed income in the self-employment section.

Foreign tax was taken? Keep your payslips and proof of tax paid. Still declare the income in its normal place, then in “Tailor your return” say Yes to the foreign section — but only to enter the foreign tax paid. HMRC then gives you Foreign Tax Credit Relief so you’re not taxed twice. Don’t enter the same income twice.

Employed by a non-UK company? You only get a PAYE reference if the employer is UK-based. No UK employer = no PAYE ref, so add the employer, declare the income and simply leave the PAYE reference box blank.

Were you paid in a foreign currency?

Everything on your return is in GBP, so:

• Paid in GBP → record as normal.
• Paid into a GBP account, no tax taken → the conversion’s already done; use that figure.
• Paid into a GBP account with tax/deductions taken → use the rate it was converted at and apply it to both your gross income and the deductions.
• Paid into a foreign-currency account (e.g. a cruise-ship cash card) → if you transfer it all to GBP, use the amount that lands; if you keep or spend it abroad, convert your total income and deductions to GBP.

The SansDrama App pulls the European Central Bank rate and does the conversion for you.

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