Foreign Tax Credit Relief

UK residents are required to report foreign income on a tax return, however, can deduct an amount from UK tax generated by way of a 'Foreign Tax Credit'.  This concerns any tax deducted by the country from which the income emanates.  This deduction cannot be greater than the equivalent UK tax generated on the same income type and, in some cases (on certain types of income), the relief is restricted to a percentage as determined in the taxation treaty between the two countries (see 'Double Taxation Treaty').