Income and Corporation Taxes Act 1988

Separate taxation

287 Separate taxation of wife’s earnings

(1) Where a man and his wife living with him jointly so elect or have elected for any year of assessment, the wife’s earnings and their other income shall be chargeable to income tax as provided in the following provisions of this section.

(2) References in this section to the wife’s earnings are references to any earned income of hers other than—

(a) income arising in respect of any pension, superannuation or other allowance, deferred pay or compensation for loss of office given in respect of the husband’s past services in any office or employment; or

(b) any payment of benefit under the Social Security Acts except a Category A retirement pension (exclusive of any increase under section 10 of the [1975 c. 60.] Social Security Pensions Act 1975 or Article 12 of the [S.I. 1975/1503. (N.I. 15).] Social Security Pensions (Northern Ireland) Order 1975), unemployment benefit or invalid care allowance.

In this subsection “the Social Security Acts” means the Social Security Acts 1975 and the Social Security (Northern Ireland) Acts 1975.

(3) In charging the income of the husband and wife in accordance with section 279—

(a) the wife’s earnings shall be charged to income tax as if she were a single woman with no other income; and

(b) the husband’s other income shall be charged to income tax as if the wife’s earnings were nil.

(4) Subject to subsections (5) and (6) below, the reliefs to be given under Chapter I of this Part shall be determined as if the husband and the wife were not married and—

(a) the wife’s earnings were her only income; and

(b) the husband’s income included all income of the wife, other than her earnings;

and accordingly the reliefs to be given under that Chapter in respect of the income chargeable under either paragraph (a) or paragraph (b) of subsection (3) above shall not reduce the tax or the income chargeable under the other of those paragraphs.

(5) No relief shall be given to either the husband or the wife under section 257(2) or (3) or 259.

(6) References in Chapter I of this Part to the claimant shall be construed as including the wife.

(7) Notwithstanding anything to the contrary in the Income Tax Acts, where any amount is under any provision of those Acts to be deducted from or set off against income in respect of any payments, loss or capital allowance, then—

(a) if under that provision it is (or is in the first instance) to reduce the wife’s earned income, or is to be deducted or set off in respect of payments made by her or, in the case of relief under Chapter III of this Part, in respect of a payment made by her as a subscription for shares, it shall be treated as reducing her earnings and as not reducing any other income; and

(b) in any other case, it shall be treated as not reducing the wife’s earnings.

(8) Subsection (7) above shall not affect the giving of any relief under section 388 for a year of assessment for which no election under this section was in force.

(9) Income tax charged on the wife’s earnings under subsection (3)(a) above shall, whether or not an application under section 283 is in force, be assessed and recovered as if she were a single woman, and any repayment of tax assessed in pursuance of this subsection shall be made to her.

(10) Where subsection (4) of section 284 applies for the purposes of subsections (1) to (3) of that section, it shall apply also for the purposes of this section; but, subject to that, nothing in this section shall be taken to affect the provisions of the Management Act as to returns.

288 Elections under section 287

(1) An election under section 287 (“an election”) must be made in such form and manner as the Board may prescribe and must be made not earlier than six months before the beginning of the year of assessment for which it is made nor later than 12 months after the end of that year or such later time as the Board may in any particular case allow.

(2) An election for any year of assessment shall, unless revoked, have effect for any subsequent year of assessment.

(3) An election in force for any year may be revoked by notice in such form and manner as the Board may prescribe and any such notice must be given jointly by the husband and the wife not later than 12 months after the end of that year or such later time as the Board may in any particular case allow.

(4) An election or revocation of an election under this section that could have been made jointly with a person who has died may, within the time permitted by this section, be made jointly with his personal representatives.