- Latest available (Revised)
- Point in Time (29/07/2004)
- Original (As enacted)
Version Superseded: 06/04/2005
Point in time view as at 29/07/2004. This version of this provision has been superseded.
You are viewing this legislation item as it stood at a particular point in time. A later version of this or provision, including subsequent changes and effects, supersedes this version.
Note the term provision is used to describe a definable element in a piece of legislation that has legislative effect – such as a Part, Chapter or section.
Income and Corporation Taxes Act 1988, Section 646 is up to date with all changes known to be in force on or before 12 September 2024. There are changes that may be brought into force at a future date. Changes that have been made appear in the content and are referenced with annotations.
Changes and effects yet to be applied by the editorial team are only applicable when viewing the latest version or prospective version of legislation. They are therefore not accessible when viewing legislation as at a specific point in time. To view the ‘Changes to Legislation’ information for this provision return to the latest version view using the options provided in the ‘What Version’ box above.
M1(1)Subject to subsections (3) to (7) below [F1and section 646(A)], in this Chapter “net relevant earnings”, in relation to an individual, means the amount of his relevant earnings for the year of assessment in question, less the amount of any deductions within subsection (2) below which fall to be made from the relevant earnings in computing for the purposes of income tax his total income for that year.
(2)Deductions are within this subsection if they are—
(a)deductions which but for section 74(m), (p) or (q) could be made in computing the profits or gains of the individual;
[F2(b)deductions made by virtue of section 232, 336, 343, 344 or 351 of ITEPA 2003 (mileage allowance, expenses, professional membership fees, annual subscriptions, ministers of religion);
(ba)travelling or subsistence expenses deducted by virtue of Part 5 of that Act;
(bb)deductions made by virtue of section 332(3) of this Act;]
(c)deductions in respect of relief under Schedule 9 to the Finance Act 1981 (stock relief);
(d)deductions in respect of losses or capital allowances, being losses or capital allowances arising from activities profits or gains of which would be included in computing relevant earnings of the individualor the individual’s wife or husbandF3.
(3)For the purposes of this section, an individual’s relevant earnings shall be taken to be those earnings before giving effect to any capital allowances, other than deductions allowable in computing profits or gains, but after taking into account the amounts on which charges fall to be made [F4under [F5the Capital Allowances Act (including enactments which under this Act are to be treated as contained in that Act)]]; and in subsections (4) and (5) below, references to income (other than references to total income) shall be construed similarly.
(4)In the case of an individual’s partnership profits, the amount to be included in arriving at his net relevant earnings shall be his share of the partnership income (estimated in accordance with the Income Tax Acts) after making from it any such deductions in respect of—
(a)payments made by the partnership;
(b)relief given to the partnership under Schedule 9 to the Finance Act 1981; or
(c)capital allowances falling to be made to the partnership,
as would be made in computing the tax payable in respect of that income.
(5)Where, in a year of assessment for which [F6the basic rate limit is increased in accordance with section 639(5A) in the case] of an individual—
(a)a deduction in respect of such a loss or allowance of the individual as is mentioned in subsection (2)(d) above falls to be made in computing the total income of the individualor the individual’s wife or husbandF7; and
(b)the deduction or part of it falls to be so made from income other than relevant earnings;
the amount of the deduction made from that other income shall be treated as reducing the individual’s net relevant earnings for subsequent years of assessment in accordance with subsection (6) below.
(6)The deduction shall be made so far as possible from the individual’s net relevant earnings for the first of the subsequent years of assessment (whether or not he is entitled to relief [F8in accordance with section 639(5A)] for that year), and then, so far as it cannot be so made, from those of the next year, and so on.
(7)F9. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Textual Amendments
F11989 s.77and Sch.7 para.7for the year 1989-90and subsequent years.
F2S. 646(2)(b)-(bb) substituted for s. 646(2)(b) (6.4.2003 with effect in accordance with s. 723(1) of the amending Act) by Income Tax (Earnings and Pensions) Act 2003 (c. 1), Sch. 6 para. 94 (with Sch. 7)
F3 Words repealed by 1988(F) s.148and Sch.14 Part VIIIfor 1990-91and subsequent years.
F41990(C) s.164and Sch.1 para.8(29).Previously
“under the 1968 Act (including the enactments which under this Act or the 1970 Act are to be treated as contained in Part I of the 1968 Act)”.
F5Words in s. 646(3) substituted (with effect in accordance with s. 579 of the amending Act) by Capital Allowances Act 2001 (c. 2), Sch. 2 para. 54
F6Words in s. 646(5) substituted (with effect in accordance with Sch. 13 para. 21(5) of the amending Act) by Finance Act 2000 (c. 17), Sch. 13 para. 21(2) (with Sch. 13 Pt. 2)
F7 Words repealed by 1988(F) s.148and Sch.14 Part VIIIfor 1990-91and subsequent years.
F8Words in s. 646(6) substituted (with effect in accordance with Sch. 13 para. 21(5) of the amending Act) by Finance Act 2000 (c. 17), Sch. 13 para. 21(3) (with Sch. 13 Pt. 2)
F9S. 646(7) repealed (with effect in accordance with Sch. 13 para. 21(5), Sch. 40 Pt. 2(4) Note 5 of the repealing Act) by Finance Act 2000 (c. 17), Sch. 13 para. 21(4), Sch. 40 Pt. 2(4)
Marginal Citations
M1Source-1987 (No.2) s.37
The Whole Act you have selected contains over 200 provisions and might take some time to download. You may also experience some issues with your browser, such as an alert box that a script is taking a long time to run.
Would you like to continue?
The Whole Act you have selected contains over 200 provisions and might take some time to download.
Would you like to continue?
The Whole Act without Schedules you have selected contains over 200 provisions and might take some time to download. You may also experience some issues with your browser, such as an alert box that a script is taking a long time to run.
Would you like to continue?
The Whole Act without Schedules you have selected contains over 200 provisions and might take some time to download.
Would you like to continue?
The Whole Act you have selected contains over 200 provisions and might take some time to download. You may also experience some issues with your browser, such as an alert box that a script is taking a long time to run.
Would you like to continue?
The Whole Act without Schedules you have selected contains over 200 provisions and might take some time to download. You may also experience some issues with your browser, such as an alert box that a script is taking a long time to run.
Would you like to continue?
The Schedules you have selected contains over 200 provisions and might take some time to download. You may also experience some issues with your browser, such as an alert box that a script is taking a long time to run.
Would you like to continue?
Latest Available (revised):The latest available updated version of the legislation incorporating changes made by subsequent legislation and applied by our editorial team. Changes we have not yet applied to the text, can be found in the ‘Changes to Legislation’ area.
Original (As Enacted or Made): The original version of the legislation as it stood when it was enacted or made. No changes have been applied to the text.
Point in Time: This becomes available after navigating to view revised legislation as it stood at a certain point in time via Advanced Features > Show Timeline of Changes or via a point in time advanced search.
Geographical Extent: Indicates the geographical area that this provision applies to. For further information see ‘Frequently Asked Questions’.
Show Timeline of Changes: See how this legislation has or could change over time. Turning this feature on will show extra navigation options to go to these specific points in time. Return to the latest available version by using the controls above in the What Version box.
Access essential accompanying documents and information for this legislation item from this tab. Dependent on the legislation item being viewed this may include:
This timeline shows the different points in time where a change occurred. The dates will coincide with the earliest date on which the change (e.g an insertion, a repeal or a substitution) that was applied came into force. The first date in the timeline will usually be the earliest date when the provision came into force. In some cases the first date is 01/02/1991 (or for Northern Ireland legislation 01/01/2006). This date is our basedate. No versions before this date are available. For further information see the Editorial Practice Guide and Glossary under Help.
Use this menu to access essential accompanying documents and information for this legislation item. Dependent on the legislation item being viewed this may include:
Click 'View More' or select 'More Resources' tab for additional information including: