Income Tax (Trading and Other Income) Act 2005 section 530

Income tax treated as paid

Section 530 deals with the income tax credit available to individuals and trustees on chargeable gains from life insurance contracts and similar policies, and the circumstances in which that credit may be reduced.

• Individuals and trustees liable to tax on a gain under this chapter are treated as having already paid income tax at the basic rate on that gain, but this notional tax credit is not repayable.
• Higher-rate and trust-rate taxpayers will have a further liability after setting off the basic rate credit, while basic-rate taxpayers and non-taxpayers have no additional liability.
• If the individual's taxable income is reduced by deductions (at Step 2 or Step 3 of the section 23 ITA 2007 calculation) that fall against the part of income charged under this chapter, the tax credit is reduced by the same amount.
• The entire section is subject to the exceptions set out in section 531.