If you are a UK tax resident and earnings from abroad, then understanding about form S106 is necessary for you. Form S106 (“foreign pages”) is a supplementary form used to be a part as a UK Self assessment tax return.  Form S106 is used to declare foreign income or gains. SA106 form is a supplementary document used for your Self Assessment Tax Return (SA100). It helps to record foreign income and gains, such as; dividend earnings, rental income or savings in abroad. If you have paid foreign tax on this income, SA106 also helps you claim Foreign Tax Credit Relief (FTCR), and helps you in to avoid double taxation. From S106 always submitted along with from SA100.

Who Needs to Fill in SA106?

You must complete the SA106 form if you are a UK tax resident earning income or gains from foreign sources.

• Rental income from property abroad.
• Earning interest or dividends from overseas bank accounts or investments.
• Receiving pension from abroad.
• Paying foreign tax on employment or self-employment income.

Exceptions to Filing SA106:

Not everyone needs to submit form SA106.

• Property Income Allowance: If your total foreign property income (including UK property income) is £1,000 or less, it qualifies for the Property Income Allowance.
• Foreign employment income: If you’re reporting foreign job income (not foreign tax), use SA102 to declare this. Only use SA106 to claim foreign tax relief. If you`re a non-dom investor.
• Income from a business or partnership: Declare this through SA101 (Additional Income) or SA104 (Partnership) instead of the foreign income section.
• Furnished holiday lettings: If your earnings are from furnished holiday lettings in the European Economic Area, file them using SA105, unless taxable under a remittance basis.

To ensure accuracy, always refer to HMRC’s foreign income notes before filing your tax return. It will helps you understand whether foreign income needs to be reported, making tax filing simpler and stress-free.

How Does HMRC Know About Undeclared Foreign Income?

HMRC uses various methods to identify undeclared foreign income. Among these is the Common Reporting Standard (CRS), an information-sharing agreement between participating countries. In this financial institutions from abroad are required to share details about accounts holders who are UK taxpayers.

If anyone fails to declare their foreign income that could be result penalties or investigations. If you are not good or having doubt about any situation; tax credits for pre-paid foreign income you must contact a good financial advisor. TAXVAT have experienced and talented team to help you in those time.

Simplify Filing SA106 Process.

Filing taxes with foreign income doesn’t have to be stressful. Whether you’re using the SA106 form yourself or getting help from tax software, there are tools to make the process easier and even uncover potential savings. Remember, timely and accurate submissions are key to staying compliant and avoiding any headaches. If you are facing any problem with from SA106 contact us.