Use cases / Foreign income
Tax on foreign income
If you are UK resident you pay UK tax on foreign income as it arises, wherever it is paid. Tax already withheld abroad is usually credited against the UK bill, but never more than the UK tax on that income.
Key figures
| Figure | 2025/26 | 2026/27 |
|---|---|---|
| Dividend allowance (covers foreign dividends) | £500 | £500 |
| Dividend tax (basic / higher / additional) | 8.75% / 33.75% / 39.35% | 10.75% / 35.75% / 39.35% |
| Personal savings allowance (basic / higher / additional) | £1,000 / £500 / £0 | £1,000 / £500 / £0 |
| Starting rate band for savings (low earners) | £5,000 | £5,000 |
How the rules work
Same allowances, same rates
Foreign dividends use the £500 dividend allowance and dividend rates. Foreign interest is savings income, covered by the personal savings allowance (£1,000 basic rate, £500 higher rate, nothing for additional rate).
Foreign tax credit relief
The credit is the lower of the foreign tax actually and finally paid and the UK tax due on the same income. Where a tax treaty caps the foreign rate, any withholding above the treaty rate must be reclaimed from the foreign tax authority, not credited here.
Remittance basis
The remittance basis ended on 6 April 2025. UK residents are now taxed on foreign income and gains as they arise, with a four-year foreign income and gains (FIG) regime available to new arrivals who have not been UK resident in the previous ten years.
Reporting
Report foreign income and any credit claimed in the foreign pages (SA106) of your Self Assessment return, converting amounts to sterling.
Our calculator covers foreign dividends and interest for UK-resident individuals. Foreign employment, rental and pension income, and FIG elections are not modelled.
Work out your own number
- Foreign dividends & interest – UK tax on overseas income and how much foreign tax you can credit.
Then sign up free to save the result and see how to lower your bill.
HMRC and GOV.UK sources
Related
General information for UK taxpayers, not personal tax advice. Figures reflect the 2025/26 and 2026/27 tax years and are checked against the same rules our calculators use.