Guidance on the limits on income tax reliefs

HMRC have published guidance on the limits on Income Tax reliefs enacted in the Finance Act 2013 and having effect from the tax year 2013-14, reports Harris & Co accountancy services.

The limit applies to certain reliefs, which were previously unlimited and that are available to reduce an individual’s total income. The limit is the greater of £50,000 or 25 per cent of the individual’s adjusted total income for a tax year.

The guidance explains, with supporting examples, how the limit is calculated, the measure of income used to calculate the limit, which reliefs are subject to the limit, and how different circumstances are treated.