16 Income tax charged by deduction

(1) In computing a person’s total income for any year —

• payments received under deduction of tax at the standard rate are treated as the income of that year, and
• charges paid under deduction of tax at the standard rate are allowed as deductions for that year.

This rule applies even where the payments or charges accrue in whole or in part before or after the year in question.

(2) Income tax is chargeable at the standard rate only on so much of a person’s income as represents charges from which income tax is deductible.

Relevant Date: Finance Act 2021