UK Expat Foreign Income Reporting 2026 -- SA106, Worldwide Disclosure and FIG

Last reviewed: 26 April 2026

UK expat foreign income reporting covers the legal obligation for UK-resident individuals to declare overseas income and gains to HMRC on their Self Assessment tax return. The obligation to report foreign income exists for all UK-resident taxpayers (defined by the Statutory Residence Test, gov.uk/guidance/the-statutory-residence-test-srt) who receive income from overseas sources above the relevant allowances -- whether from foreign employment, overseas dividends, foreign rental properties, overseas pensions, or foreign interest. Since Finance Act 2025 abolished non-domicile status from 6 April 2025, UK-resident individuals are taxed on worldwide income from day one of UK residency (subject to the 4-year FIG transitional exemption), removing the old remittance basis mechanism that had previously sheltered unremitted foreign income. For the UK tax residency framework that determines who must report foreign income, see our UK tax residency guide. For the investment account context that generates reportable foreign income, see our UK expat investments guide.

UK expat foreign income reporting has three distinct scenarios: (1) UK-resident expats who have returned to the UK and receive foreign income (overseas rental, foreign dividends, overseas pension) -- all must be declared on SA106; (2) non-UK-resident UK expats who have UK-source income -- no SA106 required for non-UK-source income; only UK-source income declared on SA105 (UK property), main SA100, or SA109 (non-residency); and (3) former non-doms or long-term residents who have failed to disclose foreign income in prior years and now want to regularise through the HMRC Worldwide Disclosure Facility (WDF). The Finance Act 2025 4-year FIG regime provides a transitional carve-out: new UK residents who qualify (not UK-resident in any of the prior 10 consecutive tax years) are exempt from UK income tax and CGT on all foreign income and gains for their first 4 tax years of UK residency. During the FIG period, foreign income does not need to be included on the UK Self Assessment return as taxable income (though the FIG status may need to be declared). HMRC’s SA106 form is at gov.uk/government/publications/self-assessment-foreign-sa106.

Who must report foreign income to HMRC

The obligation to report foreign income to HMRC via Self Assessment arises for UK-resident taxpayers who receive overseas income above the relevant allowances. The SRT (Statutory Residence Test, Finance Act 2013) determines UK tax residency annually: UK residents are taxed on worldwide income from day one of UK residency (subject to FIG exemption for qualifying new residents). Categories of foreign income that must typically be reported on SA106 include: foreign employment income (salary from an overseas employer for duties performed outside the UK, where the UK employer is not withholding PAYE); overseas dividends (dividends from non-UK companies, above the £500 dividend allowance for 2025/26); foreign interest (interest from non-UK bank accounts, non-UK bonds); foreign rental income (rental from properties sited outside the UK); foreign pension income (private pension from an overseas pension scheme, government service pension from a foreign state); and foreign income from self-employment (business income from a non-UK source). The personal allowance (£12,570 for 2025/26) applies against total UK and foreign income combined; small amounts of foreign income (below the allowance) may not result in additional UK tax but may still trigger a Self Assessment filing requirement where the total income exceeds the Self Assessment threshold (income above £100,000 or self-employment income above £1,000). HMRC’s Self Assessment guidance at gov.uk/self-assessment-tax-returns confirms filing obligations.

SA106: how to complete the foreign income supplementary pages

The SA106 (Foreign income supplementary pages) is the HMRC Self Assessment form for declaring overseas income and claiming double taxation relief. Key sections of the SA106 relevant to UK expat foreign income reporting: Box 1-14 (Income from employment, self-employment, property, and trusts abroad -- reported in GBP at the average exchange rate for the tax year, or the spot rate on the date of receipt per HMRC published exchange rates at gov.uk/government/publications/hmrc-exchange-rates-for-2025-to-2026); Box 17-27 (Foreign interest and dividends -- enter the gross foreign dividend before any overseas withholding tax; claim the foreign tax credit in Box 22 for withholding tax paid in the source country); Box 28-34 (Foreign pensions); and Box 38-46 (Capital gains on foreign assets -- alternatively, report on SA108). UK dividend tax rates from 6 April 2026 (Autumn Budget 2025 OOTLAR): ordinary rate 10.75% (was 8.75%); upper rate 35.75% (was 33.75%); additional rate 39.35% (unchanged). Foreign dividends above the £500 dividend allowance for 2025/26 are taxed at these UK dividend rates; foreign tax credit relief prevents double taxation where overseas withholding tax has already been deducted. HMRC’s SA106 form and notes are at gov.uk/government/publications/self-assessment-foreign-sa106.

The 4-year FIG regime: carve-out from foreign income reporting

The 4-year FIG (Foreign Income and Gains) regime (Finance Act 2025, effective 6 April 2025) provides a fundamental carve-out from UK expat foreign income reporting for qualifying new UK residents. Qualifying individuals (those not UK-resident in any of the prior 10 consecutive tax years who become UK-resident from 6 April 2025 onwards) are exempt from UK income tax and CGT on all foreign income and gains for the first 4 tax years of UK residency -- regardless of whether the income is remitted to the UK. During the FIG period, the qualifying foreign income does not form part of the UK-taxable income and does not need to be declared as taxable on the SA106. However, UK-resident individuals in the FIG period must still file a UK Self Assessment return if they have UK-source income above the allowance or other filing triggers; they may need to declare their FIG status on the SA109 supplementary pages. The Temporary Repatriation Facility (TRF), available for 2025/26 and 2026/27, allows former non-doms to remit pre-2025 foreign income and gains at a flat rate (12% for 2025/26, 15% for 2027/28 per Autumn Budget 2025 OOTLAR) -- a one-time opportunity to regularise pre-FIG foreign income at a reduced rate without standard Income Tax or CGT. HMRC’s FIG regime guidance at gov.uk/hmrc-internal-manuals/residence-domicile-and-remittance-basis is the authoritative reference.

Worldwide Disclosure Facility: regularising past non-disclosure

HMRC’s Worldwide Disclosure Facility (WDF) allows individuals with undisclosed offshore income, assets, or gains to voluntarily come forward and regularise their UK tax position. The WDF is available at gov.uk/guidance/worldwide-disclosure-facility-make-a-disclosure; disclosures are submitted online through HMRC’s Digital Disclosure Service. The WDF covers: undisclosed foreign income from prior years (rental, dividends, employment, self-employment); undisclosed capital gains on overseas assets; and undisclosed assets (bank accounts, investments, property) held offshore. Making a voluntary WDF disclosure before HMRC contacts the taxpayer attracts significantly reduced penalties compared to those applied after an HMRC compliance enquiry. HMRC’s offshore penalty regime (Finance Act 2017, gov.uk/guidance/penalties-for-offshore-matters-and-transfers) applies to undisclosed foreign income; penalties are calibrated by "territory category" (1, 2, or 3 depending on the jurisdiction’s information exchange status with HMRC) and range from 30% to 200% of the unpaid tax where HMRC discovers the non-disclosure. The maximum penalty for deliberate non-disclosure of offshore income in a Category 3 territory (low-information-exchange jurisdiction) is 200% of the tax due. UK expats who have become UK-resident and have historic overseas income that was not reported should seek specialist cross-border tax advice on whether a WDF disclosure is appropriate before HMRC initiates a compliance enquiry.

Finance Act 2025 IHT and overseas asset reporting

The Finance Act 2025 residence-based IHT (effective 6 April 2025) has significant implications for UK expat foreign income and asset reporting, particularly for those who have returned to the UK from long periods abroad. Long-term UK residents (those UK-resident in at least 10 of the prior 20 tax years) are subject to UK IHT on their worldwide estate -- meaning overseas property, foreign bank accounts, and non-UK investments are within the UK IHT estate. From an annual reporting perspective, the IHT exposure of worldwide assets must be considered in estate planning, even if the individual does not report the annual income from those assets as UK-taxable during a FIG period. The Finance Act 2025 also introduced a requirement for executors and personal representatives of estates that include overseas assets to report those assets on IHT account (form IHT400) where applicable. HMRC’s IHT guidance at gov.uk/inheritance-tax covers the reporting requirements for overseas assets in UK IHT estates. The HMRC IHT Manual (gov.uk/hmrc-internal-manuals/inheritance-tax-manual) is the technical reference for overseas asset valuation and reporting for IHT purposes.

Penalty regime: Finance Act 2017 offshore penalties

The Finance Act 2017 penalty regime for offshore non-disclosure is significantly more severe than the penalties for UK-source income non-disclosure. Under the Finance Act 2017 (gov.uk/guidance/penalties-for-offshore-matters-and-transfers), penalties for offshore income and asset non-disclosure are categorised by the tax territory: Category 1 territories (high-information-exchange OECD/CRS countries: USA, Australia, most EU states) attract penalties of 30-100% of the unpaid tax for unprompted disclosure and up to 150% for HMRC-prompted disclosure; Category 2 territories (moderate information exchange) attract penalties of 60-150%; Category 3 territories (low information exchange, non-CRS countries) attract penalties of 100-200% of the unpaid tax. The "asset-based penalty" (an additional 10% of the offshore asset value) applies where the offshore asset is not disclosed after an HMRC warning letter and HMRC discovers it independently. In addition to financial penalties, HMRC has the power to publish the names of those who fail to correct offshore non-compliance under the "Requirement to Correct" legislation (Finance (No.2) Act 2017). HMRC’s offshore compliance team at gov.uk/guidance/worldwide-disclosure-facility-make-a-disclosure handles voluntary disclosures; a voluntary WDF disclosure substantially reduces the penalty rate compared to a compliance investigation.

This article is for general information only and does not constitute tax, legal, financial or immigration advice. Rules and rates change; verify with the primary sources cited or consult a qualified adviser before acting.

FAQ

Do UK residents have to report foreign income to HMRC?

Yes. UK-resident taxpayers (defined by the SRT, gov.uk/guidance/the-statutory-residence-test-srt) must declare all worldwide income on their UK Self Assessment return via SA106 (Foreign income supplementary pages). Finance Act 2025 abolished non-dom status from 6 April 2025; from that date, all UK residents are taxed on worldwide income from day one of residency, subject to the 4-year FIG exemption for qualifying new arrivals. HMRC’s Self Assessment guidance at gov.uk/self-assessment-tax-returns confirms filing obligations.

What is the SA106 form and how is it used?

The SA106 is HMRC’s Foreign income supplementary pages for Self Assessment. It is used to declare: overseas employment income, foreign dividends and interest, foreign rental income, overseas pension income, and gains on foreign assets (though capital gains may alternatively be reported on SA108). Foreign income is reported in GBP at HMRC’s published average exchange rates (gov.uk/government/publications/hmrc-exchange-rates-for-2025-to-2026). Double taxation relief for overseas withholding tax is claimed in SA106. The form is available at gov.uk/government/publications/self-assessment-foreign-sa106.

What is the 4-year FIG regime and who is exempt from reporting?

The FIG (Foreign Income and Gains) regime (Finance Act 2025, from 6 April 2025) exempts qualifying new UK residents from UK tax on all foreign income and gains for 4 years, provided they have not been UK-resident in any of the prior 10 consecutive tax years. During the FIG period, foreign income is not UK-taxable and does not need to be reported as taxable on SA106 (though FIG status may need to be declared on SA109). After 4 years, worldwide income becomes fully UK-taxable. HMRC guidance at gov.uk/hmrc-internal-manuals/residence-domicile-and-remittance-basis.

What are the penalties for not reporting foreign income?

HMRC’s Finance Act 2017 offshore penalty regime applies: penalties range from 30-200% of unpaid tax depending on the territory category (Category 1 = OECD/CRS high-exchange countries; Category 3 = low-exchange jurisdictions). Category 3 deliberate non-disclosure penalties can reach 200% of tax due. An asset-based penalty (10% of asset value) applies where HMRC discovers the non-disclosure independently after a warning letter. HMRC may also publish the names of deliberate non-disclosers. Voluntary WDF disclosure substantially reduces penalties.

What is the Worldwide Disclosure Facility and when should I use it?

HMRC’s Worldwide Disclosure Facility (WDF, gov.uk/guidance/worldwide-disclosure-facility-make-a-disclosure) allows individuals with undisclosed offshore income, gains, or assets to voluntarily regularise their UK tax position. A voluntary WDF disclosure before HMRC contacts the taxpayer attracts significantly lower penalties than a post-enquiry disclosure. The WDF covers undisclosed foreign income from any prior year, overseas capital gains, and offshore assets. Specialist cross-border tax advice (ICAEW/CIOT-qualified) is strongly advisable before submitting a WDF disclosure.

What are UK dividend tax rates for foreign dividends in 2026?

UK dividend tax rates from 6 April 2026 (Autumn Budget 2025 OOTLAR): ordinary rate 10.75% (was 8.75%); upper rate 35.75% (was 33.75%); additional rate 39.35% (unchanged). These rates apply to UK-resident taxpayers on total dividends (UK and foreign) above the £500 dividend allowance for 2025/26. Foreign dividends are grossed up before the overseas withholding tax credit is applied on SA106. Report the gross foreign dividend, then claim relief for the overseas withholding tax paid in the source country to avoid double taxation.

Sources

1. HMRC -- SA106 Foreign income supplementary pages (form and notes) (verified 26 April 2026)
2. HMRC -- Worldwide Disclosure Facility: how to make a voluntary offshore disclosure (verified 26 April 2026)
3. HMRC -- Finance Act 2017 offshore penalty regime (30-200% of unpaid tax) (verified 26 April 2026)
4. HMRC -- FIG regime, non-dom abolition (Finance Act 2025) and TRF guidance (verified 26 April 2026)
5. GOV.UK -- Autumn Budget 2025 OOTLAR (dividend rates 10.75%/35.75%/39.35% from 6 April 2026) (verified 26 April 2026)