Section 729 | Payments for non-taxable consideration

(1)A payment that meets condition A is only exempt from income tax under section 727(1) if condition B or C is met.

(2)Condition A is that—

(a)the payment is made under a liability incurred at any time for consideration in money or money's worth, and

(b)some or all of the consideration is not required to be brought into account in calculating the payer's income for income tax purposes.

(3)Condition B is that the payment is income within section 627(1) (payments on dissolution or separation) in the recipient's hands.

(4)Condition C is that the payment is made to an individual under a liability incurred at any time in consideration of the individual surrendering, assigning or releasing an interest in settled property to or in favour of a person with a subsequent interest.

(5)In the application of subsection (4) to Scotland, the reference to settled property is to be read as a reference to property held in trust.