Income Tax (Earnings and Pensions) Act 2003

668 Taxable maximum

(1) A claimant’s taxable maximum for a week is determined under this subsection if the applicable amount for the purpose of calculating the income support consists only of an amount in respect of the relevant couple.

The taxable maximum is equal to one half of the applicable amount.

(2) A claimant’s taxable maximum for a week is determined under this subsection if the applicable amount includes amounts that are not in respect of the relevant couple.

The taxable maximum is equal to one half of the amount which is included in the applicable amount in respect of the relevant couple.

(3) A claimant’s taxable maximum for a part of a week is determined as follows—

• Step 1

  Assume that the income support is paid to the claimant for the whole of, rather than part of, the week.

• Step 2

  Determine under subsection (1) or (2) what the claimant’s taxable maximum for that week would be on that assumption.

• Step 3

  Determine the claimant’s taxable maximum for the part of the week using this formula—

  

  where—

  • N is the number of days in the part of the week for which the claimant is actually paid the income support, and

  • TMW is the taxable maximum for the whole week determined under step 2.