What benefits qualify for tax relief when acquiring a new residence under section 277?

Section 277 identifies five qualifying benefits: legal services connected with the acquisition including loan-related legal work, waiver of loan procurement fees, waiver of mortgage indemnity insurance costs where the loan is a substantial part of the property value, surveys or inspections of the residence, and connection of utility services for use by the employee or their family.

What expenses qualify under section 277 of the Income Tax (Earnings and Pensions) Act 2003?

Qualifying expenses include payments for legal services, surveys or inspections, and utility connections. They also cover loan procurement fees, mortgage indemnity insurance costs, fees payable to the relevant land registry or register in connection with the acquisition, and stamp duty or stamp duty land tax charged on the property purchase.

Who can acquire the new residence and still qualify for relocation relief under section 277?

The acquisition does not have to be made by the employee personally. It can be made by the employee alone, by one or more members of the employee's family or household alone, or jointly by the employee together with family or household members. This recognises that property purchases are often made in joint names or by a spouse.

Do references to employee loans in section 277 extend to loans raised by family members?

Yes. Wherever section 277 refers to a loan raised by the employee, this extends equally to loans raised by one or more members of the employee's family or household, or by the employee jointly with such members. This ensures relocation relief applies regardless of who formally takes on the mortgage or loan.

Income Tax (Earnings and Pensions) Act 2003 section 277

Acquisition benefits and expenses

Section 277 sets out the specific benefits and expenses connected with acquiring a new residence that may qualify for tax relief under the relocation provisions of the Act.

The acquisition of an interest in the new residence can be made by the employee, by one or more members of their family or household, or by any combination of them
Qualifying benefits include legal services, waiver of loan procurement fees, waiver of high-percentage loan insurance costs, surveys or inspections, and connection of utilities
Qualifying expenses include payments for those services, loan procurement fees, insurance costs, land registry fees, and stamp duty or stamp duty land tax
References to loans raised by the employee extend equally to loans raised by family or household members, or jointly by the employee and such members

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