Too late to be excluded

The taxpayer agreed with his employer in December 1997 that he would retire in January 2000. Upon retiring he received a company pension and part of that included medical benefit payments.

Until 2006 these payments were not taxable. However the employer wrote to the taxpayer advising him that from 2006 the payments became taxable under ITEPA 2003 s 393B introduced by FA 2004.

The taxpayer therefore included the payments on his self assessment tax returns for 2006/07 and subsequent years.

It was only after he filed his 2006/07 return that the Employer-Financed Retirement Benefit (Excluded Benefits for Tax Purposes) Regulations were made to define ‘excluded benefits’. The regulations took effect from 2006/07.

The taxpayer continued to include the medical...