Commentary

E1.428 Purchased life annuities—charge to tax

Personal and employment tax

E1.428 Purchased life annuities—charge to tax

Purchased life annuities

E1.428 Purchased life annuities—charge to tax

A 'purchased life annuity' ('PLA') is an annuity, for a term referable to the end of a human life, purchased for money or money's worth in the ordinary course of a business of granting such annuities1.

An annuity payment under a PLA is charged to income tax as savings and investment income and not under the separate provision for annual payments generally2 (see ITTOIA 2005, Pt 5, Ch 7 (ss 683–686) regarding annual payments not otherwise charged to tax). The charge is on the person receiving or entitled to the payment3.

The

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