Paragraph 12

Before section 643A insert—

““Protected foreign-source income” and “transitional trust income”

643ZA

(1)

In this Chapter—

• “protected foreign-source income” means income that—

  1. (a)

     arose under a settlement in any of the tax years 2017-18 to 2024-25, and

  2. (b)

     was protected foreign-source income for that tax year within the meaning of section 628A (as that section had effect for that tax year).

• “transitional trust income” means income that—

  1. (a)

     arose under a settlement in any of the tax years 2008-09 to 2016-17, and

  2. (b)

     was transitional trust income throughout the tax years 2017-18 to 2024-25 within the meaning of section 628C (as that section had effect for those tax years).

(2)

For the purposes of subsection (1) ignore section 648(3) to (5) (foreign income treated as arising under settlement only if and when remitted).

Protected foreign-source income and transitional trust income not to be taxed elsewhere in Chapter

643ZB

(1)

The rules in sections 624(1) and 629(1) do not apply to protected foreign-source income or transitional trust income (which, by virtue of section 648(3) to (5), may be treated as income arising under the settlement in the tax year 2025-26 or a subsequent tax year).

(2)

In the following provisions, “income” does not include protected foreign-source income or transitional trust income—

• section 635(2) and (3)(d)(i);

• section 636(1), (2) (in the words before paragraph (a)), (4) and (6);

• section 637(5) and (7A).”