NHS Mid & South Essex ICB and others v HMRC

In NHS Mid & South Essex ICB and others v HMRC [2024] UKFTT 1117 (TC) (4 December 2024) the FTT decided that an element of the NHS continuing healthcare (CHC) redress payments constituted interest for the purposes of ITA 2007 s 874 and furthermore that the interest constituted yearly interest or was treated as yearly interest under ITA 2007 s 874(5A) since the interest was payable to individuals in respect of compensation. 

The appellants Integrated Care Boards (ICBs) appealed against assessments to income tax. They argued unsuccessfully that no part of the payments they made to various individuals under the NHS Continuing Healthcare Redress arrangements was interest for the purposes of the withholding tax obligation imposed on payments of UK source yearly interest under ITA 2007 s 874 even if that part had been calculated in the same way as...