Paragraph 26 Statutory redundancy payments

Section 579^f1 is amended as follows.

For subsection (3) (amount of payment to be allowable as expenses of management eligible for relief under section 75 or 76 etc) substitute—

“(3)

Where a redundancy payment or other employer’s payment is made in respect of employment wholly in a business carried on by the employer and—

(a)

expenses of management of the business are deductible under section 75, or

(b)

a deduction for expenses payable falls to be allowed in accordance with section 76 in computing profits of the business,

the amount of the redundancy payment, or the corresponding amount of the other employer’s payment, shall (to the extent that it would not otherwise fall to be so treated) be deductible under section 75 as expenses of management or as the case may be, be included at Step 1 in section 76(7).

(3A)

If in a case where subsection (3) above applies, the payment in question is for the purposes of section 75 or 76 referable to an accounting period beginning after discontinuance, it shall be treated as referable to the accounting period ending on the last day on which the business was carried on.”.