Section 839 | Annual payments payable out of relevant foreign income

(1)In calculating the amount of relevant foreign income to be charged to income tax for a tax year, a deduction is to be allowed for an annual payment other than interest if it meets conditions A, B1 or B2 and C .

(2)Condition A is that the payment is payable out of the relevant foreign income.

(3)Condition B1 is that, had the payment arisen in the United Kingdom, it would have been chargeable to income tax under one of the following provisions ...—

section 579 (charge to tax on royalties and other income from intellectual property),

Chapter 4 of Part 5 (certain telecommunication rights: non-trading income), ...

Chapter 7 of Part 5 (annual payments not otherwise charged).

, or regulation 15 of the Unauthorised Unit Trusts (Tax) Regulations 2013.

(3A)Condition B2 is that, had the payment arisen in the United Kingdom it would have been—

(a)required to be brought into account under Part 5 of CTA 2009 (loan relationships) as a non-trading credit, or

(b)chargeable to corporation tax under Chapter 7 of Part 10 of that Act (annual payments not otherwise charged) or regulation 15 of the Unauthorised Unit Trusts (Tax) Regulations 2013 .

(4)Condition C is that the payment is made to a non-UK resident.

(5)Subsection (1) does not apply if—

(a)the relevant foreign income is received in the United Kingdom, or

(b)it is charged for the tax year in accordance with section 832 (relevant foreign income charged on remittance basis).

(6)Repealed