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A & G Pope v HMRC

In A & G Pope v HMRC (TC00761 – 18 November) a geologist (P) was kidnapped in Angola in 1998 and was never seen or heard from again. He had taken out a life insurance policy and in 2002 the insurers paid his parents £100 000 under the policy plus a further £36 425 which was described as interest. HMRC issued a ruling that the £36 425 was subject to income tax. P’s parents appealed contending that it should be treated as exempt under what is now ITTOIA 2005 s 751. The First-Tier Tribunal rejected this contention and dismissed the appeal holding that ‘payments under a life assurance policy were of a different kind than damages payments made in respect of personal injury or death’.

Why it matters: ITTOIA 2005 s 751 provides that payments of ‘interest on damages for personal injury’ are exempt from...

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