½Û×ÓÊÓƵ

ITEPA 2003 categorises employment income as either 'general earnings' or 'specific employment income'¹. The rules in ITEPA 2003 concerning the residence and domicile of an employee² for purposes of the charge to tax on general earnings do not apply for purposes of the charge to tax on specific employment income. Payments within ITEPA 2003, s 401 fall within the definition of specific employment income³. The effect of this is that a termination payment under ITEPA 2003, s 401 may be taxable even though it is received by a non-UK resident who, as a result of his residence status, is outside the scope of the charge to tax on 'general earnings'.

A termination payment in respect of the employment of an individual who is not resident in the UK (and/or ordinarily resident in the UK before 6 April 2013), and not working in the UK, is therefore potentially within the scope of the charge to tax under ITEPA 2003, ss 401–416 if the individual was at any stage