The procedure for calculating a person’s income-tax liability is prescribed as a series of steps (ITA 2007, s. 23). However, this procedure does not deal with the income-tax liabilities set out at ¶148-550. Where the taxpayer is non-UK-resident, the rules at ¶148-650ff. must be taken into account.

The calculation

Step 1

Identify the individual amounts of each type of income on which the taxpayer is charged for the year. These amounts are termed the ‘components’ of ‘total income’.

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