|
|
TAX TREATMENT OF ANNUITIES
Tax treatment of annuities
There is no tax relief for the cost of the annuity. Each receipt from a life annuity is treated partly as a return of the amount paid for it (the capital element) and partly as interest (the income element). Any capital element is tax free but the income element is liable to income tax in full and is usually paid after deduction of basic rate income tax, which can be reclaimed by non taxpayers.
« BACK
|
|
|
