Income Tax (Trading and Other Income) Act 2005 section 828A

Indexation of the fixed amount and the amount per adult and child

Section 828A provides for the annual inflation-linked uprating of the foster care relief fixed amount and the per-adult and per-child amounts, using the consumer prices index.

• The fixed amount (section 808) and the per-adult/per-child amounts (section 811) are increased each year if the September consumer prices index is higher than the previous September's figure.
• The fixed amount is uprated by applying the percentage CPI increase to the previous year's figure, rounding up if necessary to the nearest £10, and adding the result to the previous year's amount.
• The per-adult and per-child amounts are uprated in the same way, but any rounding is to the nearest £5 rather than £10.
• The Treasury must make an order before the start of each tax year to replace the existing statutory figures with the newly calculated amounts.