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HMRC HS263 — 2026FTCR EstimateSA106

UK Foreign Tax Credit Relief (FTCR) Calculator

Estimate Foreign Tax Credit Relief using the HMRC 2026 method: calculate UK tax with and without the foreign income, then limit the credit by the eligible foreign tax and any applicable treaty restriction.

FTCR Estimator

Estimate the UK tax attributable to one foreign-income item

Enter your other taxable income before adding this foreign-income item.
Enter one foreign-income item in GBP.
If a treaty limits admissible foreign tax, enter the maximum amount allowed under that treaty.

How UK Foreign Tax Credit Relief Works

Foreign Tax Credit Relief can prevent the same foreign income or capital gain from being taxed twice where it is chargeable in both the foreign country and the UK. HMRC's 2026 HS263 guidance covers relief under a Double Taxation Agreement, Foreign Tax Credit Relief and deduction relief.

The important calculation is not simply income × marginal rate

HMRC's working-sheet method calculates the UK tax liability with the foreign item included and then recalculates the liability with that item removed. The difference is the UK tax attributable to that particular foreign item. This matters because personal allowances, tax bands and other parts of the tax computation can change when the income is added.

The credit is subject to multiple limits

The allowable credit is generally the lowest of the UK tax attributable to the foreign item, the eligible foreign tax paid, and any amount of foreign tax permitted under the relevant Double Taxation Agreement. Foreign tax paid above the applicable limit does not automatically become additional UK credit.

Treaty relief and unilateral relief are not the same thing

A Double Taxation Agreement may determine which country has the taxing right or may restrict the foreign tax that can be credited. If the treaty gives exclusive taxing rights to the UK or the foreign country, the result can be different from simply applying a generic tax-credit formula. Where treaty relief does not resolve the double taxation, UK domestic rules may provide credit relief subject to their own conditions.

Different foreign income items may require separate calculations

If you have several foreign income sources, HMRC's 2026 guidance says the calculation should be performed separately for each eligible item rather than simply combining all foreign income and foreign tax into one figure. The most beneficial allocation of allowances and losses can also matter in more complicated cases.

Foreign dividends and capital gains need extra care

This estimator is intentionally designed for ordinary non-dividend foreign income. Foreign dividends, capital gains and other specialist categories can involve different UK tax rates, allowances, treaty provisions and calculations. HMRC provides separate working-sheet guidance for income and capital gains.

The 2025/26 FIG regime can change the result

The Foreign Income and Gains regime applies from 6 April 2025 for qualifying new UK residents. If eligible foreign income or gains are covered by a FIG claim, FTCR cannot also be claimed on the same income or gains. The FIG rules therefore need to be checked before relying on a foreign-tax-credit calculation.

Reporting through Self Assessment

Foreign income and foreign tax are generally reported on the Foreign pages (SA106) when Self Assessment requires them. HMRC's 2026 notes explain that taxpayers can allow HMRC to calculate the credit by providing the relevant return information, or calculate the relief themselves using HS263. Supporting evidence should be retained so the foreign income and foreign tax claimed can be substantiated.

Frequently Asked Questions (6)

Foreign Tax Credit Relief (FTCR) can reduce UK tax where the same foreign income or capital gain has also been taxed overseas. The UK credit is generally limited by the UK tax attributable to that particular foreign item, the foreign tax paid or allowed, and any applicable treaty restriction.

HMRC's 2026 working-sheet method calculates the UK tax on total income including the foreign item and then recalculates the UK tax excluding that item. The difference is the UK tax attributable to the foreign income. The credit is then the lower of that amount, the eligible foreign tax, and any applicable treaty limit.

Yes. A Double Taxation Agreement can allocate taxing rights between the UK and another country or restrict the foreign tax that can be taken into account for credit relief. If the treaty limits the admissible foreign tax, the excess normally cannot simply be credited against the UK liability.

Potentially, yes, where the income is also chargeable to UK tax and the relevant conditions are met. The exact calculation depends on the type of income, the taxpayer's wider tax position, the foreign tax paid and the applicable treaty. Foreign capital gains can also have separate FTCR calculations.

Foreign income and foreign tax are generally reported through the Foreign pages (SA106) where Self Assessment requires them. HMRC's 2026 notes say you can allow HMRC to calculate the credit if you complete the relevant return information, or calculate it yourself using HS263 and enter the relevant amount in the FTCR section.

You cannot claim FTCR on foreign income or gains covered by a FIG claim. HMRC states that FTCR can instead apply to the appropriate proportion of foreign income or gains that is not covered by the FIG claim. The FIG regime therefore needs to be considered before calculating a foreign tax credit.
GOV.UK SourcesOfficial HMRC Guidance
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FTCR Key Rules
2026 guidanceHS263
Claim formSA106
UK credit limitUK tax attributable
FIG interactionNo FTCR on FIG income
Related UK Tax Tools
📊 Self-Employment Tax Tool →🌐 2026 FIG / Foreign Income Guide →💷 UK Income Tax Calculator →
Important

For multiple foreign income sources, foreign capital gains, dividends, Scottish taxpayers, FIG claims or other complex circumstances, use HMRC's current HS263 working sheets or professional tax advice rather than relying on this simplified estimator.