General Deductions From Income (Info)

When calculating income for tax credit purposes deduct the amount of

• Any banking charge or commission payable for the cost of exchanging foreign currency (income) to Sterling

• Gifts to charity as approved under Section 25 of Finance Act 1990

• The full contribution made by either the claimant or partner towards any of the following which is approved under part 14 of the Taxes Act 2001

• A retirements benefits scheme including a pilots benefit fund approved under Section 607 of the Act and a relevant statutory scheme within the meaning of Section 611A of the Act

• A retirement annuity contract approved under Chapter 3 of Part 14 of the Act

• A personal pension scheme and the amount of any tax relief due on the contributions approved under Chapter 4 of Part 14 of the Act

If a claimant receives income in a foreign currency they may convert the income into sterling when applying for tax credits. The conversion is calculated by using the average annual exchange rate for the 12 month period up to 28th March in the tax year in which the income arises.