Sale of income in exchange for capital amount

A capital sum received by an individual in respect of the sale or relinquishment of income derived from their personal activities can sometimes be treated as earned income and chargeable to Income Tax. If this is the case, the amount charged to Income Tax is not also charged to Capital Gains Tax.


  2. Transactions or arrangements must have been effected putting some other person in a position to exploit the earnings capacity of that individual.


There are anti-avoidance provisions which are aimed at arrangements where an individual gives up the prospect of future income but, either he or some other person, receives instead a ‘capital amount’.

Source: HM Revenue & Customs Wed, 04 Nov 2020 00:00:00 +0100
Phone: 01235 250011
Fax: 01235 250022

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