The Horizon Convictions Redress Scheme
and Horizon Shortfall Scheme Fixed
Sum Award (Tax Exemptions and Relief)
Regulations, SI 2024/818, exempt two new
compensation payments from income tax,
CGT and corporation tax, and provide
relief from IHT. The relevant payments are
the Horizon Convictions Redress Scheme
payments, and Horizon Shortfall Scheme
Fixed Sum Award (HSS Fixed Sum Award)
payments.
HSS Fixed Sum Award payments to
postmasters in the Horizon Shortfall
Scheme will be exempt from income tax and
CGT. Payments to corporate entities will be
exempt from corporation tax.
The Horizon Convictions Redress
Scheme payments, compensating those
eligible under the Post Office (Horizon
System) Offences Act 2024 for losses
including loss of earnings, will be exempt
from income tax and CGT, and relieved
from IHT.
The regulations come into force on
16 August 2024. The exemptions and
relief will have retrospective effect from
13 March 2024.
The Social Security (Contributions)
(Amendment No. 4) Regulations, SI
2024/822, provide that Horizon Convictions
Redress Scheme compensation payments
and HSS Fixed Sum Awards are disregarded
from earnings for Class 1 NICs purposes.
These regulations come into force on
16 August 2024, but HMRC will use their
collection and management powers not to
collect Class 1 NICs on payments made
before that date.
HMRC have also published a policy
paper on both sets of regulations.
The Horizon Convictions Redress Scheme
and Horizon Shortfall Scheme Fixed
Sum Award (Tax Exemptions and Relief)
Regulations, SI 2024/818, exempt two new
compensation payments from income tax,
CGT and corporation tax, and provide
relief from IHT. The relevant payments are
the Horizon Convictions Redress Scheme
payments, and Horizon Shortfall Scheme
Fixed Sum Award (HSS Fixed Sum Award)
payments.
HSS Fixed Sum Award payments to
postmasters in the Horizon Shortfall
Scheme will be exempt from income tax and
CGT. Payments to corporate entities will be
exempt from corporation tax.
The Horizon Convictions Redress
Scheme payments, compensating those
eligible under the Post Office (Horizon
System) Offences Act 2024 for losses
including loss of earnings, will be exempt
from income tax and CGT, and relieved
from IHT.
The regulations come into force on
16 August 2024. The exemptions and
relief will have retrospective effect from
13 March 2024.
The Social Security (Contributions)
(Amendment No. 4) Regulations, SI
2024/822, provide that Horizon Convictions
Redress Scheme compensation payments
and HSS Fixed Sum Awards are disregarded
from earnings for Class 1 NICs purposes.
These regulations come into force on
16 August 2024, but HMRC will use their
collection and management powers not to
collect Class 1 NICs on payments made
before that date.
HMRC have also published a policy
paper on both sets of regulations.
