Income Tax (Trading and Other Income) Act 2005 section 73

Counselling and other outplacement services

Section 73 allows a trading deduction for the cost of counselling and outplacement services provided to employees who are leaving their role.

• Employers can deduct the cost of counselling and outplacement services provided to departing employees when calculating trading profits.
• Qualifying expenses include the direct provision of services, payment or reimbursement of fees for such services, and payment or reimbursement of related travel costs.
• The deduction is only available where the conditions set out in section 310 of ITEPA 2003 are met, which also exempt the employee from income tax on the benefit received.
• The employee must hold or have held an office or employment under the employer for the purposes of the trade.