Income Tax Act 2007 Schedule 2 paragraphs 14–17

Personal reliefs

Paragraphs 14 to 17 of Schedule 2 set out transitional rules governing how personal reliefs (such as personal allowances and the blind person's allowance) interact with the new structure of income tax introduced by the Income Tax Act 2007.

• Personal reliefs continue to reduce an individual's total income to arrive at taxable income, preserving the effect of earlier legislation under the new framework.
• Where an individual's personal allowances exceed their net income, the excess cannot create a loss or be transferred to another person; it is simply lost.
• The ordering rules for deducting personal reliefs remain unchanged: allowances are set against different categories of income in the same sequence as under previous legislation.
• Any references in other enactments to the old provisions dealing with personal reliefs are to be read as references to the corresponding provisions in the Income Tax Act 2007.

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