Who counts as 'the insured' under section 742 of ITTOIA 2005?

Under section 742 of the Income Tax (Trading and Other Income) Act 2005, 'the insured' includes the policyholder, their spouse or civil partner, children under 21 of the insured or their spouse or civil partner, and any person jointly liable for a transaction identified in the insurance policy alongside the insured or their spouse or civil partner.

Are children covered under the definition of 'the insured' in section 742?

Yes, section 742 extends the definition of 'the insured' to include any child under the age of 21 who belongs to either the insured person or the insured person's spouse or civil partner. This ensures that younger family members benefit from the health and employment insurance payment exemptions under sections 735 to 737.

Can a business partner be considered 'the insured' under section 742?

Yes, if a business partner is jointly liable with the insured or the insured's spouse or civil partner for any actual or proposed transaction identified in the insurance policy, that business partner falls within the definition of 'the insured' under section 742 and can benefit from the exemptions in sections 735 to 737.

What is the practical effect of the extended definition in section 742 ITTOIA 2005?

The practical effect is that exempt payments under qualifying health and employment insurance policies can benefit a broader family and business unit, not just the individual policyholder. Spouses, civil partners, children under 21, and jointly liable persons are all covered, widening the scope of the exemptions under sections 735 to 737.

Income Tax (Trading and Other Income) Act 2005 section 742

Meaning of "the insured"

Section 742 defines who counts as "the insured" for the purposes of the health and employment insurance payment exemptions in sections 735 to 737.

The term "the insured" extends beyond the policyholder to include their spouse or civil partner
Children under 21 of the insured person or their spouse or civil partner are also covered by the definition
Any person who shares joint liability for a transaction identified in the policy with the insured or their spouse or civil partner is included
This broader definition applies specifically within the context of sections 735 to 737, which deal with exempt health and employment insurance payments

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