Income Tax (Earnings and Pensions) Act 2003 section 329

Deductions from earnings not to exceed earnings

Section 329 establishes the fundamental rule that any deductions you claim against your employment earnings cannot exceed the amount of those earnings, with special rules for split tax years and multiple deductions.

• Total allowable deductions from earnings under Part 5 cannot exceed the earnings from which they are deducted
• In a split year, deductions are scaled down proportionally to reflect only the non-excluded portion of earnings
• Where multiple deductions apply to the same earnings, their combined total is capped at those earnings, and deductions from other parts of the tax code take priority
• Ministers of religion expenses (section 351) are exempt from these capping rules and are treated as deductions arising outside Part 5