Income Tax (Trading and Other Income) Act 2005 section 844

Income charged on withdrawal of relief after source ceases

Section 844 deals with how previously unremittable income is taxed when the relief under the unremittable income rules is withdrawn, but the underlying trade, property business or other income source has already permanently ceased.

• Where unremittable income relief is withdrawn after a trade, profession or vocation has permanently ceased, the income is taxed as a post-cessation receipt under the trading income rules, with no cap on the amount chargeable
• Where the relief is withdrawn after a property business has permanently ceased, the income is taxed as a post-cessation receipt from a UK property business, again with no cap on the amount chargeable
• Where the income came from any other source that has ceased, it is taxed as though the person still possessed that source
• The normal limits on post-cessation receipt charges (sections 243 and 350) are disapplied, so the full amount of the withdrawn relief is brought into charge