Section 425 Total amount of income tax to which individual charged for a tax year

United Kingdom

(1)

For the purposes of sections 423 and 424, the total amount of income tax to which an individual is charged for a tax year is the amount calculated as follows.

(2)

Calculate the individual's liability to income tax for the tax year in accordance with section 23, as modified by subsection (3).

(3)

In applying section 23—

(a)

at Step 6, ignore any tax reductions to which the individual is entitled for the tax year under a provision listed in subsection (4), and

(b)

ignore Step 7.

(4)

The tax reductions to be ignored are tax reductions under—

(a)

section 453 (qualifying maintenance payments),

(b)

F1sections 2 and 6 of TIOPA 2010 (double taxation arrangements: relief by agreement), or

(c)

F2section 18(1)(b) and (2) of TIOPA 2010 (relief for foreign tax where no double taxation arrangements).

(5)

From the amount calculated in accordance with subsections (2) to (4) deduct—

(a)

any tax treated as having been paid under—

F3(i)

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F4(ii)

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(iii)

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(iv)

section 530(1) of that Act (gains from contracts for life insurance), or

(v)

section 685A(3) of that Act (settlor-interested settlements), F5... F6and

(b)

any tax treated as deducted from estate income under section 656(3) or 657(4) of ITTOIA 2005, so far as that income is treated under section 679 of that Act as paid from sums within section F7680(4) of that Act F8...

(c)

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(6)

For the purposes of this section a person is treated as being entitled to a tax reduction under F9sections 2 and 6 of TIOPA 2010 if the person is entitled to credit against income tax under double taxation arrangements.

Annotations

Textual amendments

F1: Words in s. 425(4)(b) substituted (with effect in accordance with s. 381(1) of the amending Act) by Taxation (International and Other Provisions) Act 2010 (c. 8), s. 381(1), Sch. 8 para. 80(2)(a) (with Sch. 9 paras. 1-9, 22)
F2: Words in s. 425(4)(c) substituted (with effect in accordance with s. 381(1) of the amending Act) by Taxation (International and Other Provisions) Act 2010 (c. 8), s. 381(1), Sch. 8 para. 80(2)(b) (with Sch. 9 paras. 1-9, 22)
F3: S. 425(5)(a)(i) omitted (for the tax year 2026-27 and subsequent tax years) by virtue of Finance Act 2026 (c. 11), s. 42(2)(a)(5)
F4: S. 425(5)(a)(ii)(iii) omitted (with effect in accordance with Sch. 1 para. 73 of the amending Act) by virtue of Finance Act 2016 (c. 24), Sch. 1 para. 63(4)(a)(ii)
F5: Word in s. 425(5)(a)(v) omitted (21.7.2008 with effect in accordance with s. 34(2) of the amending Act) by virtue of Finance Act 2008 (c. 9), Sch. 12 para. 24(a)
F6: Word in s. 425(5) inserted (with effect in accordance with Sch. 1 para. 73 of the amending Act) by Finance Act 2016 (c. 24), Sch. 1 para. 63(4)(b)
F7: Word in s. 425(5)(b) substituted (with effect in accordance with Sch. 1 para. 73 of the amending Act) by Finance Act 2016 (c. 24), Sch. 1 para. 63(4)(c)
F8: S. 425(5)(c) omitted (with effect in accordance with Sch. 1 para. 73 of the amending Act) by virtue of Finance Act 2016 (c. 24), Sch. 1 para. 63(4)(d)
F9: Words in s. 425(6) substituted (with effect in accordance with s. 381(1) of the amending Act) by Taxation (International and Other Provisions) Act 2010 (c. 8), s. 381(1), Sch. 8 para. 80(3) (with Sch. 9 paras. 1-9, 22)