Taxation (International and Other Provisions) Act 2010 section 33

Limit on credit: minimisation of the foreign tax

Section 33 requires a taxpayer claiming double taxation credit relief to have taken all reasonable steps to minimise the foreign tax paid before the credit is calculated.

• The credit for foreign tax must not exceed the amount that would apply if the taxpayer had taken all reasonable steps to reduce the foreign tax liability.
• Reasonable steps include claiming available reliefs, deductions, reductions, or allowances under the foreign territory's law, as well as making any beneficial tax elections.
• Steps must also be considered under any applicable double taxation arrangements with the relevant territory.
• Whether a step was reasonable is judged on the basis of what the taxpayer would have been expected to do if UK credit relief were not available.