Explanatory note

These Regulations provide for an exemption from income tax for payments under the Successful Legacy Appeals Scheme administered by the Department for Work and Pensions in Great Britain and any corresponding scheme administered by the Department for Communities in Northern Ireland (the “Schemes”). The Schemes provide compensation for people who experienced a financial loss when they had to claim universal credit due to a decision to terminate their award of one of the means tested benefits that universal credit replaces, and later had the termination decision reversed.

Paragraph 3 of Schedule 15 to the Finance Act 2020 provides for an exemption from income tax in respect of qualifying payments that are received on or after the date specified in regulations made under paragraph 2(5), which under paragraph 3(5) may be a date before the regulations are made. Regulation 2 specifies that payments received under the Schemes on or after 14th May 2026 are qualifying payments for this purpose.

A Tax Information and Impact Note has not been prepared for this Instrument as it contains no substantive changes to tax policy.