Income Tax Act 2007 section 777

Conditions for sections 778 and 779 to apply

Section 777 sets out the three conditions that must all be satisfied before sections 778 and 779 can treat income as arising in connection with the sale or exploitation of an individual's occupation income.

• The individual must carry on an occupation wholly or partly in the United Kingdom (Condition A).
• Transactions or arrangements must be made to exploit the individual's earning capacity, putting another person in a position to enjoy the resulting income, receipts, or anything derived from them (Condition B).
• As part of, in connection with, or as a consequence of those transactions or arrangements, a capital amount must be obtained by the individual for themselves or for another person (Condition C).
• A "capital amount" is any amount in money or money's worth that would not otherwise be included in an income calculation under the Tax Acts apart from this chapter.