Commentary on Sections Example 3 Ne = £5,000; Da = 183; De = 183; Smg = 0 Overview
2256.This Part identifies the income that is taxed as pension income.
2257.The Part charges income described as a pension in the source legislation. It also charges other income that is in the nature of pension income but is not described as a pension in the source legislation.
2258.Different Chapters in the Part identify the various forms that pension income can take and set out the rules governing each form. For each category of income the Chapters specify the person liable to tax and the basis of the charge.
2259.There is no statutory definition of “pension” for tax purposes, although voluntary pensions are specifically included. So “pension” has its ordinary meaning. That is a very wide meaning. The definition of “pension” fills almost three columns of the Oxford English Dictionary.
2260.The Part sets out the exemptions that apply to income that would otherwise be chargeable. It also sets out the deductions that are allowed in calculating taxable pension income; payroll giving donations and the 10% deduction for certain overseas government pensions. The 10% deduction for foreign pensions is dealt with by cross-reference to section 65(2) of ICTA.