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Tax exemption for war widow recognition payments

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The following two sets of regulations provide an income tax exemption and NICs disregard for the £87,500 war widows recognition payments, in line with the recent UK government announcement that these payments would be exempt from tax:

  • War Widows Recognition Payment Scheme (Income Tax Exemption) Regulations, SI 2023/1171; and
  • Social Security (Contributions) (Amendment No. 7) Regulations, SI 2023/1172.

The income tax exemption applies to payments received on or after 1 October 2023.

The war widows recognition payment scheme is available to those who lost entitlement to their war widow(er)’s pension when they remarried or cohabited, under rules that were in place up to 2015.

Issue: 1641
Categories: News