Income Tax (Earnings and Pensions) Act 2003

Chapter 1 U.K. Exemptions: general

227 Scope of Part 4 U.K.

(1) This Part contains—

(a) earnings-only exemptions, and

(b) employment income exemptions.

(2) In this Act “earnings-only exemption” means an exemption from income tax which—

(a) prevents liability to tax arising in respect of earnings, either by virtue of one or more particular provisions (such as a Chapter of the benefits code) or at all, and

(b) does not prevent liability to tax arising in respect of other employment income.

(3) In this Act “employment income exemption” means an exemption from income tax which prevents liability to tax arising in respect of employment income of any kind at all.

(4) The following provisions in Part 7 also confer exemption from liability to income tax in respect of earnings—

[F1 (za) section 418(1A) (acquisition of, and chargeable events occurring in relation to, employment-related securities options);]

[F2 (a) section 425 (restricted securities: no charge in respect of acquisition in certain circumstances),

(b) section 475 (no charge in respect of acquisition of securities option),]

(c) sections 489 to 493 and sections 496 to 499 (F3 ... share incentive plans),

F4 (d) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(e) section 519 (F5 ... SAYE option schemes: no charge in respect of exercise of option),

F6 (f) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(g) section 524 (F7 ... CSOP schemes: no charge in respect of exercise of option),

F8 (h) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(i) section 542 (priority share allocations: exemption where offer made to public and employees), and

(j) section 544 (priority share allocations: exemption where different offers made to public and employees).

[F9 (5) In relation to the interaction between this Part and Part 7A, see section 554P(1).]

Textual Amendments

F1 S. 227(4)(za) inserted (6.4.2016) by Finance Act 2016 (c. 24), s. 17(3)(4)

F2 S. 227(4)(a)(b) substituted (with effect in accordance with Sch. 22 para. 25(4) of the amending Act, and otherwise 1.9.2003) by Finance Act 2003 (c. 14), Sch. 22 para. 25(2); S.I. 2003/1997, art. 2

F3 Word in s. 227(4)(c) omitted (6.4.2014) by virtue of Finance Act 2014 (c. 26), Sch. 8 paras. 45, 89 (with Sch. 8 paras. 90-96)

F4 S. 227(4)(d) repealed (with effect in accordance with Sch. 22 para. 25(4) of the amending Act, and otherwise 1.9.2003) by Finance Act 2003 (c. 14), Sch. 22 para. 25(3), Sch. 43 Pt. 3(4); S.I. 2003/1997, art. 2

F5 Word in s. 227(4)(e) omitted (6.4.2014) by virtue of Finance Act 2014 (c. 26), Sch. 8 paras. 130, 146 (with Sch. 8 paras. 147-157)

F6 S. 227(4)(f) repealed (with effect in accordance with Sch. 22 para. 25(4) of the amending Act, and otherwise 1.9.2003) by Finance Act 2003 (c. 14), Sch. 22 para. 25(3), Sch. 43 Pt. 3(4); S.I. 2003/1997, art. 2

F7 Word in s. 227(4)(g) omitted (6.4.2014) by virtue of Finance Act 2014 (c. 26), Sch. 8 paras. 191, 204 (with Sch. 8 paras. 205-215)

F8 S. 227(4)(h) repealed (with effect in accordance with Sch. 22 para. 25(4) of the amending Act, and otherwise 1.9.2003) by Finance Act 2003 (c. 14), Sch. 22 para. 25(3), Sch. 43 Pt. 3(4); S.I. 2003/1997, art. 2

F9 S. 227(5) inserted (with effect in accordance with Sch. 2 paras. 52-59 of the amending Act) by Finance Act 2011 (c. 11), Sch. 2 para. 11

228 Effect of exemptions on liability under provisions outside Part 2 U.K.

(1) The exemptions conferred by the provisions specified in subsection (2) prevent liability to income tax arising under any enactment, but the other exemptions in this Part only affect liability to income tax under Part 2 of this Act.

(2) The provisions referred to in subsection (1) are—

(a) section 245 (travelling and subsistence during public transport strikes),

(b) section 248 (transport home: late night working and failure of car-sharing arrangements),

(c) section 264 (annual parties and functions),

(d) Chapter 8 of this Part (exemptions for special kinds of employees) except for sections [F10 290, 290C to] 291 [F11 and 306A] ,

[F12 (da) section 308B (independent advice in respect of conversions and transfers of pension scheme benefits),]

(e) section 323 (long service awards),

(f) section 324 (small gifts from third parties), and

(g) section 326 (expenses incidental to transfer of a kind not normally met by transferor).

Textual Amendments

F10 Words in s. 228(2)(d) substituted (with effect in accordance with s. 13(4) of the amending Act) by Finance Act 2015 (c. 11), Sch. 1 para. 13

F11 Words in s. 228(2)(d) inserted (with effect in accordance with s. 14(4) of the amending Act) by Finance Act 2015 (c. 11), s. 14(3)

F12 S. 228(2)(da) inserted (with effect in accordance with s. 54(3) of the amending Act) by Pension Schemes Act 2015 (c. 8), ss. 54(2), 89(3)(b) (with s. 87)