Income Tax (Trading and Other Income) Act 2005 section 817

Alternative calculation of profits: income chargeable under Chapter 8 of Part 5

Section 817 sets out how to calculate the taxable amount when an individual's qualifying care receipts do not amount to a trade but exceed the individual's tax-free limit for the year.

• This section applies where qualifying care receipts are taxable as miscellaneous income (income not otherwise charged to tax) rather than as trading income.
• The taxable amount is calculated by taking the individual's total qualifying care receipts for the tax year and deducting the individual's limit for that year.
• The calculation covers all care arrangements from which the individual derives qualifying care receipts during the tax year.
• Only the excess of total qualifying care receipts over the individual's limit is subject to income tax.