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Association of Chartered Certified Accountants


Posted on by Steve

PPI payouts are usually formed from 3 elements.

The first 2 elements constitute the compensation. They are a refund of the premiums paid as well as the interest paid on the premiums. These 2 elements are non taxable.

The third element is additional interest on the compensation at 8%. It is this element that is taxable.

Tax is due for the Income Tax year in which the compensation payment is made.

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