Income Tax (Earnings and Pensions) Act 2003 section 254A

Apprenticeship bursaries paid to persons leaving local authority care

Section 254A provides an income tax exemption for apprenticeship bursary payments made from public funds to individuals who have left local authority care.

• Apprenticeship bursary payments made from public funds to care leavers are completely exempt from income tax
• A care leaver is someone who is, or was, a child looked after by a local authority anywhere in the United Kingdom (England, Wales, Scotland or Northern Ireland)
• The payment must be connected with the person's employment as an apprentice, with the precise definition of "apprentice" set out in Treasury regulations
• The Treasury has power to make regulations prescribing additional conditions, which may vary by area or purpose and may apply retrospectively