Income Tax (Trading and Other Income) Act 2005

Immediate needs annuities U.K.

725 Annual payments under immediate needs annuities U.K.

(1) No liability to income tax arises under Chapter 7 of Part 4 in respect of so much of an annual payment made under an immediate needs annuity as is made—

(a) for the benefit of the person protected under that annuity, and

(b) to a care provider or a local authority in respect of the provision of care for that person.

(2) In this section “immediate needs annuity” means a contract for a purchased life annuity—

(a) the purpose or one of the purposes of which is to protect a person against the consequences of the person being unable, at the time the contract is made, to live independently without assistance because of a condition to which subsection (3) applies, and

(b) under which benefits are payable in respect of the provision of care for the person protected.

(3) This subsection applies to—

(a) mental or physical impairment, or

(b) injury, sickness or other infirmity,

which is expected to be permanent.

(4) In this section and section 726 “care” means accommodation, goods or services which it is necessary or desirable to provide to a person because of a condition to which subsection (3) applies.

(5) In this section—

• “care provider” has the meaning given in section 726, and

• “purchased life annuity” has the same meaning as in Chapter 7 of Part 4 (see section 423).

(6) The Treasury may by order amend—

(a) subsection (2), and

(b) subsection (3), so far as it applies for the purposes of subsection (2).

726 Meaning of “care provider” U.K.

(1) In section 725 “care provider” means a person who—

(a) carries on a trade, profession or vocation which consists of or includes the provision of care, and

(b) meets the care registration requirement.

[F1 (2) A person meets the care registration requirement in relation to care provided in England if the person is registered under Part 2 of the Care Standards Act 2000 or Chapter 2 of Part 1 of the Health and Social Care Act 2008 in respect of the provision of care.

[F2 (2A) A person meets the care registration requirement in relation to care provided in Wales if the person is registered under—

(a) Part 2 of the Care Standards Act 2000, or

(b) Part 1 of the Regulation and Inspection of Social Care (Wales) Act 2016 (anaw 2),

in respect of the provision of the care.]]

[F3 (3) A person meets the care registration requirement in relation to care provided in Scotland if the person provides care as, or as part of, a service which is registered under—

(a) Chapter 3 of Part 5 of the Public Services Reform (Scotland) Act 2010 (asp 8), or

(b) section 10Q of the National Health Service (Scotland) Act 1978 (c. 29).]

(4) A person meets the care registration requirement in relation to care provided in Northern Ireland if the person is registered in respect of the provision of care under—

(a) Part 2 or 3 of the Registered Homes (Northern Ireland) Order 1992 (S.I. 1992/3204 (N.I. 20)), or

(b) Part 3 of the Health and Personal Social Services (Quality, Improvement and Regulation) (Northern Ireland) Order 2003 (S.I. 2003/431 (N.I. 9)).

(5) A person meets the care registration requirement in relation to care provided in a territory outside the United Kingdom if the person meets requirements under the law of that territory relating to the provision of care that are comparable to those mentioned in subsections (2) to (4).

(6) The Treasury may by order amend this section.

Textual Amendments

F1 S. 726(2)(2A) substituted for s. 726(2) (1.10.2010) by The Health and Social Care Act 2008 (Consequential Amendments No.2) Order 2010 (S.I. 2010/813), arts. 1(1), 16

F2 S. 726(2A) substituted (E.W.) (2.4.2018) by The Regulation and Inspection of Social Care (Wales) Act 2016 (Consequential Amendments) Regulations 2018 (S.I. 2018/195), regs. 2(1), 26

F3 S. 726(3) substituted (28.10.2011) by The Public Services Reform (Scotland) Act 2010 (Consequential Modifications of Enactments) Order 2011 (S.I. 2011/2581), art. 1(2)(b), Sch. 2 para. 9