191. 'Such sum as after deduction of tax'; 'free of tax'.

It is permissible in an agreement to provide for payment of such a sum as, after deduction of income tax at the basic rate, amounts to a given figure1. The payment is in this case treated for the purposes of the Income Tax Acts2 as a payment of the grossed-up sum3, from which the payer must deduct tax on making the payment and which becomes, as so grossed-up, part of the payee's total income