CA Oti-Obihara v HMRC

In CA Oti-Obihara v HMRC (TC00819 – 2 December) an individual (C) was employed by a US bank in London. He subsequently began proceedings against the bank claiming that he had been subjected to racial discrimination and harassment. He agreed a settlement whereby his employment was terminated the bank paid him £500 000 (from which it deducted income tax) and he waived all legal claims against the bank. HMRC issued an amendment to his self-assessment treating £28 000 of the £500 000 as non-taxable damages but treating the balance of £472 000 as taxable compensation for loss of his employment (subject to the £30 000 exemption under ITEPA 2003 s 403). C appealed contending that only £18 000 of the payment should be treated as compensation for the loss of his employment and that the balance of £482...