Income Tax (Trading and Other Income) Act 2005

Payments to adopters U.K.

744 Payments to adopters[F1 , etc]: England and Wales U.K.

[F2 (1)] No liability to income tax arises in respect of the following payments—

(a) any payment or reward falling within section 57(3) of the Adoption Act 1976 (c. 36) (payments authorised by the court) which is made to a person who has adopted or intends to adopt a child,

(b) payments under section 57(3A)(a) of that Act (payments by adoption agencies of legal or medical expenses of persons seeking to adopt),

(c) payments of allowances under regulations under section 57A of that Act (permitted allowances to persons who have adopted or intend to adopt children),

(d) payments of financial support made in the course of providing adoption support services within the meaning of the Adoption and Children Act 2002 (c. 38) (see section 2(6) and (7) of that Act), F3 ...

(e) payments made under regulations under paragraph 3(1) of Schedule 4 to that Act (transitional and transitory provisions: adoption support services),

[F4 (f) payments made under regulations under section 14F of the Children Act 1989 (special guardianship support services) to a person appointed as a child's special guardian,

(g) payments made to a person under section 17 of that Act (provision of services for children in need, their families and others) by reason of that person being a person [F5 named in a child arrangements order as a person with whom a child is to live] ,

(h) payments made to a person, in respect of a child, under paragraph 15 of Schedule 1 to that Act (local authority contribution to child's maintenance to recipients [F6 with whom child is living, or is to live, as a result of a child arrangements order] ), and

(i) payments made in accordance with—

(i) an order under that Schedule (orders for financial relief against parents etc), or

(ii) a maintenance agreement,

for the benefit of a child, to a person appointed as the child's special guardian or a person [F7 named in a child arrangements order as a person with whom the child is to live] .]

[F8 (j) payments made to a person under sections 37 to 39 of the Social Services and Well-being (Wales) Act 2014 (meeting care and support needs of children) by reason of that person being named in a child arrangements order as a person with whom a child is to live.]

[F9 (2) But a payment is not within subsection (1)(f), (g), (h) [F10 , (i) or (j)] if—

(a) it is made to an excluded relative of the child,

(b) it is made to a person appointed as the child's special guardian and an excluded relative is also appointed as the child's special guardian, or

[F11 (c) it is made to a person (“P”) named in a child arrangements order as a person with whom the child is to live and an excluded relative who lives in the same household as P is also named in that order as a person with whom the child is to live.]

(3) In this section—

• “excluded relative”, in relation to a child, means—

  (a)

  a parent of the child, or

  (b)

  a person who is, or has been, the husband or wife or civil partner of a parent of the child;

• “maintenance agreement” has the meaning given by paragraph 10(1) of Schedule 1 to the Children Act 1989;

• “ [F12 child arrangements] ” has the meaning given by section 8 of that Act.]

Textual Amendments

F1 Word in s. 744 heading inserted (16.12.2010) (with effect in accordance with s. 2(5) of the amending Act) by Finance (No. 3) Act 2010 (c. 33), s. 2(2)(d)

F2 S. 744(1) renumbered (16.12.2010) (with effect in accordance with s. 2(5) of the amending Act) by Finance (No. 3) Act 2010 (c. 33), s. 2(2)(a)

F3 Word in s. 744(1) omitted (16.12.2010) (with effect in accordance with s. 2(5) of the amending Act) by virtue of Finance (No. 3) Act 2010 (c. 33), s. 2(2)(b)

F4 S. 744(1)(f)-(i) inserted (16.12.2010) (with effect in accordance with s. 2(5) of the amending Act) by Finance (No. 3) Act 2010 (c. 33), s. 2(2)(b)

F5 Words in s. 744(1)(g) substituted (22.4.2014) by Children and Families Act 2014 (c. 6), s. 139(6), Sch. 2 para. 68(2); S.I. 2014/889, art. 4(f) (with transitional provisions in S.I. 2014/1042, arts. 3, 4, 6-10)

F6 Words in s. 744(1)(h) substituted (22.4.2014) by Children and Families Act 2014 (c. 6), s. 139(6), Sch. 2 para. 68(3); S.I. 2014/889, art. 4(f) (with transitional provisions in S.I. 2014/1042, arts. 3, 4, 6-10)

F7 Words in s. 744(1)(i) substituted (22.4.2014) by Children and Families Act 2014 (c. 6), s. 139(6), Sch. 2 para. 68(4); S.I. 2014/889, art. 4(f) (with transitional provisions in S.I. 2014/1042, arts. 3, 4, 6-10)

F8 S. 744(1)(j) inserted (E.W.) (6.4.2016) by The Social Services and Well-being (Wales) Act 2014 (Consequential Amendments) Regulations 2016 (S.I. 2016/413), regs. 2(1), 223(a)

F9 S. 744(2)(3) inserted (16.12.2010) (with effect in accordance with s. 2(5) of the amending Act) by Finance (No. 3) Act 2010 (c. 33), s. 2(2)(c)

F10 Words in s. 744(2) substituted (E.W.) (6.4.2016) by The Social Services and Well-being (Wales) Act 2014 (Consequential Amendments) Regulations 2016 (S.I. 2016/413), regs. 2(1), 223(b)

F11 S. 744(2)(c) substituted (22.4.2014) by Children and Families Act 2014 (c. 6), s. 139(6), Sch. 2 para. 68(5); S.I. 2014/889, art. 4(f) (with transitional provisions in S.I. 2014/1042, arts. 3, 4, 6-10)

F12 Words in s. 744(3) substituted (22.4.2014) by Children and Families Act 2014 (c. 6), s. 139(6), Sch. 2 para. 68(6); S.I. 2014/889, art. 4(f) (with transitional provisions in S.I. 2014/1042, arts. 3, 4, 6-10)

745 Payments to adopters[F13 , etc]: Scotland U.K.

[F14 (1)] No liability to income tax arises in respect of the following payments—

(a) any payment [F15 which is an excepted payment by virtue of paragraph (a) or (c) of subsection (2) of section 73 of the Adoption and Children (Scotland) Act 2007 (asp 4),] which is made to a person who has adopted or intends to adopt a child,

(b) payments [F16 which are excepted payments by virtue of paragraph (b) of that subsection,]

F17 (c) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . F18 ...

(d) payments of allowances in accordance with an adoption allowances scheme under [F19 section 71] of that Act,

[F20 (e) payments made to a person under section 50 of the Children Act 1975, or section 22 of the Children (Scotland) Act 1995, by reason of that person being a person with whom a child is to live by virtue of a residence order, and

(f) payments of aliment made—

(i) in accordance with an award of aliment under the Family Law (Scotland) Act 1985, or

(ii) under an agreement (within the meaning of section 7(5) of that Act),

for the benefit of a child, to a person in whose favour a residence order with respect to the child is in force.]

[F21 (2) A payment is not within subsection (1)(e) or (f) if—

(a) it is made to an excluded relative of the child, or

(b) it is made to a person in whose favour a residence order is in force with respect to the child and that order is also in favour of an excluded relative.

(3) In this section—

• “excluded relative”, in relation to a child, means—

  (a)

  a parent of the child, or

  (b)

  a person who is, or has been, the husband or wife or civil partner of a parent of the child;

• “residence order” has the meaning given by section 11(2)(c) of the Children (Scotland) Act 1995.]

Textual Amendments

F13 Word in s. 745 heading inserted (16.12.2010) (with effect in accordance with s. 2(5) of the amending Act) by Finance (No. 3) Act 2010 (c. 33), s. 2(3)(d)

F14 S. 745(1): s. 745 renumbered as s. 745(1) (16.12.2010) (with effect in accordance with s. 2(5) of the amending Act) by Finance (No. 3) Act 2010 (c. 33), s. 2(3)(a)

F15 Words in s. 745(a) substituted (S.) (28.9.2009) by Adoption and Children (Scotland) Act 2007 (asp 4), s. 121(2), Sch. 2 para. 13(a); S.S.I. 2009/267, arts. 1(2), 2 (with arts. 3-21) (as amended (7.5.2012) by S.S.I. 2012/99, art. 2)

Words in s. 745(a) substituted (E.W.N.I) (15.7.2011) by The Adoption and Children (Scotland) Act 2007 (Consequential Modifications) Order 2011 (S.I. 2011/1740), art. 1(2), Sch. 2 para. 6(a)

F16 Words in s. 745(b) substituted (S.) (28.9.2009) by Adoption and Children (Scotland) Act 2007 (asp 4), s. 121(2), Sch. 2 para. 13(b); S.S.I. 2009/267, arts. 1(2), 2 (with arts. 3-21) (as amended (7.5.2012) by S.S.I. 2012/99, art. 2)

Words in s. 745(b) substituted (E.W.N.I) (15.7.2011) by The Adoption and Children (Scotland) Act 2007 (Consequential Modifications) Order 2011 (S.I. 2011/1740), art. 1(2), Sch. 2 para. 6(b)

F17 S. 745(c) repealed (S.) (28.9.2009) by Adoption and Children (Scotland) Act 2007 (asp 4), s. 121(2), Sch. 3; S.S.I. 2009/267, arts. 1(2), 2 (with arts. 3-21) (as amended (7.5.2012) by S.S.I. 2012/99, art. 2)

F18 Word in s. 745(1) omitted (with effect in accordance with s. 2(5) of the amending Act) by virtue of Finance (No. 3) Act 2010 (c. 33), s. 2(3)(b)

F19 Words in s. 745(d) substituted (S.) (28.9.2009) by Adoption and Children (Scotland) Act 2007 (asp 4), s. 121(2), Sch. 2 para. 13(c); S.S.I. 2009/267, arts. 1(2), 2 (with arts. 3-21) (as amended (7.5.2012) by S.S.I. 2012/99, art. 2)

Words in s. 745(d) substituted (E.W.N.I) (15.7.2011) by The Adoption and Children (Scotland) Act 2007 (Consequential Modifications) Order 2011 (S.I. 2011/1740), art. 1(2), Sch. 2 para. 6(c)

F20 S. 745(1)(e)(f) inserted (16.12.2010) (with effect in accordance with s. 2(5) of the amending Act) by Finance (No. 3) Act 2010 (c. 33), s. 2(3)(b)

F21 S. 745(2)(3) inserted (16.12.2010) (with effect in accordance with s. 2(5) of the amending Act) by Finance (No. 3) Act 2010 (c. 33), s. 2(3)(c)

746 Payments to adopters[F22 , etc]: Northern Ireland U.K.

[F23 (1)] No liability to income tax arises in respect of the following payments—

(a) any payment or reward falling within Article 59(2)(b) of the Adoption (Northern Ireland) Order 1987 (S.I. 1987/2203 (N.I. 22)) (payments authorised by the court) which is made to a person who has adopted or intends to adopt a child,

(b) any payment under Article 59(2)(c) of that Order (payments by registered adoption societies) which is made to a person who has adopted or intends to adopt a child, F24 ...

(c) payments of allowances under regulations under Article 59A of that Order (permitted allowances to persons who have adopted or intend to adopt children),

[F25 (d) payments made to a person under Article 18 of the Children (Northern Ireland) Order 1995 (S.I. 1995/755 (NI 2)) (general duty of authority to provide personal social services) by reason of that person being a person in whose favour a residence order with respect to a child is in force,

(e) payments made to a person, in respect of a child, under paragraph 17 of Schedule 1 to that Order (local authority contribution to child's maintenance to recipients in whose favour residence order is in force), and

(f) payments made in accordance with—

(i) an order under that Schedule (orders for financial relief against parents etc), or

(ii) a maintenance agreement,

for the benefit of a child, to a person in whose favour a residence order with respect to the child is in force.]

[F26 (2) But a payment is not within subsection (1)(d), (e) or (f) if—

(a) it is made to an excluded relative of the child, or

(b) it is made to a person in whose favour a residence order is in force with respect to the child and that order is also in favour of an excluded relative.

(3) In this section—

• “excluded relative”, in relation to a child, means—

  (a)

  a parent of the child, or

  (b)

  a person who is, or has been, the husband or wife or civil partner of a parent of the child;

• “maintenance agreement” has the meaning given by paragraph 12 of Schedule 1 to the Children (Northern Ireland) Order 1995;

• “residence order” has the meaning given by Article 8 of that Order.]

Textual Amendments

F22 Word in s. 746 heading inserted (16.12.2010) (with effect in accordance with s. 2(5) of the amending Act) by Finance (No. 3) Act 2010 (c. 33), s. 2(4)(d)

F23 S. 746(1): s. 746 renumbered as s. 746(1) (16.12.2010) (with effect in accordance with s. 2(5) of the amending Act) by Finance (No. 3) Act 2010 (c. 33), s. 2(4)(a)

F24 Word in s. 746(1) omitted (16.12.2010) (with effect in accordance with s. 2(5) of the amending Act) by virtue of Finance (No. 3) Act 2010 (c. 33), s. 2(4)(b)

F25 S. 746(1)(d)-(f) inserted (16.12.2010) (with effect in accordance with s. 2(5) of the amending Act) by Finance (No. 3) Act 2010 (c. 33), s. 2(4)(b)

F26 S. 746(2)(3) inserted (16.12.2010) (with effect in accordance with s. 2(5) of the amending Act) by Finance (No. 3) Act 2010 (c. 33), s. 2(4)(c)

747 Power to amend sections 744 to 746 U.K.

The Treasury may by order amend section 744, 745 or 746 for the purposes of—

(a) adding a description of payment, or

(b) removing a description of payment if the power to make a payment of that description has been repealed or revoked or has otherwise ceased to be exercisable.