Damages payment is it taxable?

Discussion in 'Finance, Property, Law' started by thegimp, Jun 28, 2011.

Welcome to the Army Rumour Service, ARRSE

The UK's largest and busiest UNofficial military website.

The heart of the site is the forum area, including:

  1. I'm picking up a product liability payout for a bit of equipment that failed and injured me.

    Am I liable for tax on this?

    The schedule of damages covers all sorts of areas including loss of earning as well as the obvious injury payment, travel and transport, expenses etc


    Cheers legal eagles
     
  2. Need more info' to answer this question.

    Are you in UK?
    Did accident occur in UK?
    Are you UK domiciled?

    Go and see a good Chartered Accountant.

    From the Revenue's website below:
    CG13030 - Compensation payment: personal compensation or damages




    "Sums received as compensation or damages for any 'wrong or injury' suffered by an individual in 'their person or in their profession or vocation' are not chargeable to Capital Gains Tax, TCGA92/S51 (2). The following paragraph explains what these terms mean.

    The words 'wrong or injury' include breaches of contractual duties and torts (in Scotland, delicts). If the damages received for any wrong or injury would have been exempt, then so is any compensation for professional negligence relating to any action in respect of that wrong or injury.

    The words 'in their person' are distinct from 'in their finances', but include more than physical injury so that distress, embarrassment, loss of reputation or dignity may all be suffered 'in the person'. Compensation or damages for unfair or unlawful discrimination suffered in the 'person' and for libel or slander (in Scotland defamation) are included.

    Similarly, the words 'in their profession or vocation' refer to compensation or damages suffered by an individual in their professional capacity such as unfair discrimination, libel or slander (in Scotland, defamation) as distinct from in their 'finances'. If the compensation is received by the members of a partnership, each partner is treated as receiving a share of the compensation."
     
  3. Mr_Fingerz

    Mr_Fingerz LE Book Reviewer

  4. My account seems to think it rides mainly on semantics, the wording of the documentation etc

    My accountant is also dog toffee and rigidly ******* moralistic
     
  5. PM me for a referral