Income Tax Act 2007

Chapter 2 U.K. Personal allowance and blind person's allowance

Introduction U.K.

34 Allowances under Chapter U.K.

(1) In this Chapter—

(a) sections 35, 36 and 37 deal with entitlement to a personal allowance,

(b) section 38 deals with entitlement to a blind person's allowance, and

(c) section 39 deals with the transfer of part of a blind person's allowance to a spouse or civil partner.

(2) An allowance under this Chapter is given effect at Step 3 of the calculation in section 23.

[F1 (3) For the effect of section 809B (claim for remittance basis to apply) applying to an individual for a tax year, see section 809G (no entitlement to personal allowance or blind person's allowance).]

Textual Amendments

F1 S. 34(3) inserted (21.7.2008 with effect in accordance with Sch. 7 para. 81 of the amending Act) by Finance Act 2008 (c. 9), Sch. 7 para. 76

Personal allowances U.K.

35 Personal allowance for those aged under 65 U.K.

[F2 (1)] An individual who makes a claim is entitled to a personal allowance of [F3 £6,475] for a tax year if the individual—

(a) is under the age of 65 throughout the tax year, and

(b) meets the requirements of section 56 (residence etc).

[F4 (2) For an individual whose adjusted net income exceeds £100,000, the allowance under subsection (1) is reduced by one-half of the excess.

(3) If the amount of any allowance that remains after the operation of subsection (2) would otherwise not be a multiple of £1, it is to be rounded up to the nearest amount which is a multiple of £1.

(4) For the meaning of “adjusted net income” see section 58.]

Textual Amendments

F2 S. 35(1) renumbered (with effect in accordance with s. 4(4) of the amending Act) by Finance Act 2009 (c. 10), s. 4(1)

F3 Word in s. 35 substituted (21.7.2009) by Finance Act 2009 (c. 10), s. 3(1)(a)

F4 S. 35(2)-(4) inserted (with effect in accordance with s. 4(4) of the amending Act) by Finance Act 2009 (c. 10), s. 4(1)

36 Personal allowance for those aged 65 to 74 U.K.

(1) An individual who makes a claim is entitled to a personal allowance of [F5 £9,490] for a tax year if the individual—

(a) is 65 or over at some time in the tax year, but under 75 throughout the tax year, and

(b) meets the requirements of section 56 (residence etc).

(2) For an individual whose adjusted net income for the tax year exceeds [F6 £22,900], the allowance under subsection (1)—

(a) is reduced by half the excess, but

(b) is not reduced below [F7 the amount of any allowance to which the individual would be entitled under section 35 if under the age of 65 throughout the tax year].

(3) For the meaning of “adjusted net income” see section 58.

Textual Amendments

F5 Word in s. 36(1) substituted (24.11.2008 for tax year 2009-2010) by The Income Tax (Indexation) (No. 3) Order 2008 (S.I. 2008/3023), art. 4(b)

F6 Word in s. 36(2) substituted (24.11.2008 for tax year 2009-2010) by The Income Tax (Indexation) (No. 3) Order 2008 (S.I. 2008/3023), art. 4(h)

F7 Words in s. 36(2)(b) substituted (with effect in accordance with s. 4(4) of the amending Act) by Finance Act 2009 (c. 10), s. 4(2)

37 Personal allowance for those aged 75 and over U.K.

(1) An individual who makes a claim is entitled to a personal allowance of [F8 £9,640] for a tax year if the individual—

(a) is 75 or over at some time in the tax year, and

(b) meets the requirements of section 56 (residence etc).

(2) For an individual whose adjusted net income for the tax year exceeds [F9 £22,900], the allowance under subsection (1)—

(a) is reduced by half the excess, but

(b) is not reduced below [F10 the amount of any allowance to which the individual would be entitled under section 35 if under the age of 65 throughout the tax year].

(3) For the meaning of “adjusted net income” see section 58.

Textual Amendments

F8 Word in s. 37(1) substituted (24.11.2008 for tax year 2009-2010) by The Income Tax (Indexation) (No. 3) Order 2008 (S.I. 2008/3023), art. 4(c)

F9 Word in s. 37(2) substituted (24.11.2008 for tax year 2009-2010) by The Income Tax (Indexation) (No. 3) Order 2008 (S.I. 2008/3023), art. 4(h)

F10 Words in s. 37(2)(b) substituted (with effect in accordance with s. 4(4) of the amending Act) by Finance Act 2009 (c. 10), s. 4(2)

Blind person's allowance U.K.

38 Blind person's allowance U.K.

(1) An individual who makes a claim is entitled to a blind person's allowance of [F11 £1,890] for a tax year if the individual—

(a) meets the first or second condition for the whole or part of the tax year, and

(b) meets the requirements of section 56 (residence etc).

(2) The first condition is that the individual is registered as a blind person in a register kept under section 29 of the National Assistance Act 1948 (c. 29) (registers kept by local authorities in England and Wales).

(3) The second condition is that—

(a) the individual is ordinarily resident in Scotland or Northern Ireland, and

(b) because of the individual's blindness, the individual is unable to do any work for which eyesight is essential.

(4) If an individual who is entitled to a blind person's allowance for a particular tax year—

(a) became registered as a blind person in a register kept under section 29 of the National Assistance Act 1948 in the tax year, but

(b) obtained the evidence of blindness on the basis of which the registration was made in the preceding tax year,

the individual is treated as having met the first condition for the whole of the preceding tax year.

Textual Amendments

F11 Word in s. 38(1) substituted (24.11.2008 for tax year 2009-2010) by The Income Tax (Indexation) (No. 3) Order 2008 (S.I. 2008/3023), art. 4(d)

39 Transfer of part of blind person's allowance to a spouse or civil partner U.K.

(1) This section applies to an individual who is entitled to a blind person's allowance under section 38 for a tax year if—

(a) the individual is a person whose spouse or civil partner is living with the individual for the whole or any part of the tax year, and

(b) the spouse or civil partner meets the requirements of section 56 (residence etc).

(2) If—

(a) the allowance exceeds the individual's remaining relievable income,

(b) the individual makes an election, and

(c) the individual's spouse or civil partner makes a claim,

the individual's spouse or civil partner is entitled to an allowance for the tax year equal to the amount of the excess.

(3) The individual's remaining relievable income is the amount found by—

(a) taking the amount of the individual's net income, and

(b) subtracting any personal allowance to which the individual is entitled for the tax year.

40 Election for transfer of allowance under section 39 U.K.

(1) An election under section 39—

(a) must be made [F12 not more than 4 years after the end of] the tax year to which it relates, and

(b) cannot be withdrawn.

(2) If an individual makes an election for a tax year under section 39 the individual is treated as also giving notice under section 51(4) that section 51(1) (tax reductions for married couples and civil partners: transfer of unused relief) is to apply for the tax year.

Textual Amendments

F12 Words in s. 40(1)(a) substituted (1.4.2010) by Finance Act 2008 (c. 9), s. 118(2), Sch. 39 para. 55; S.I. 2009/403, art. 2(2) (with art. 10)

Supplementary U.K.

41 Allowances in year of death U.K.

(1) Any allowance to which an individual is entitled under this Chapter for any tax year, including the tax year in which the individual dies, is given in full.

(2) If an individual was due to reach the age of 65 in a tax year, but dies in the tax year before reaching that age, the individual is treated for the purposes of section 36 as having reached the age of 65 in the tax year.

(3) If an individual was due to reach the age of 75 in a tax year, but dies in the tax year before reaching that age, the individual is treated for the purposes of sections 36 and 37 as having reached the age of 75 in the tax year.