Income Tax (Earnings and Pensions) Act 2003 section 644A

Health and employment insurance payments

Section 644A exempts from income tax certain pension or annuity payments that arise from health and employment insurance policies, where the pensioner contributed to premiums under a policy taken out by another person for their benefit.

• Pension or annuity payments linked to health and employment insurance policies may be fully or partly exempt from income tax
• The payment must be of a type that would qualify for exemption under section 735 of ITTOIA 2005 if it were treated as an annual payment
• The pensioner (or their spouse or civil partner) must have made payments or contributions towards premiums under an insurance policy that another person took out wholly or partly for the pensioner's benefit
• The exempt payments must be attributable, on a just and reasonable basis, to the premiums the pensioner contributed towards