Income Tax (Earnings and Pensions) Act 2003 section 611

Annuities in recognition of another's services

Section 611 deals with the tax treatment of annuities that have been purchased by someone in recognition of another person's services in a job or official position.

• An annuity purchased by any person to recognise another person's services in an office or employment is taxable as pension income
• Where the annuity arises from a source outside the United Kingdom, it is only taxable if it is paid to a person who is resident in the United Kingdom
• This section does not apply where the annuity already falls within Chapter 5A of the pension income Part, avoiding any double charge
• The term "office" includes any position that exists independently of its holder and can be filled by successive holders