RPSM04104020 - Technical Pages: Taxation: Unauthorised payments: Overview: Taxation of unauthorised payments

Taxation of unauthorised payments

The payment of an unauthorised payment will generate up to three tax charges.

• The unauthorised payments charge – see RPSM04104500

An income tax charge at a rate of 40%, based on the value of the unauthorised payment

• The unauthorised payments surcharge – see RPSM04104600

Where unauthorised payments go above a set amount in a set period an additional income tax charge at a rate of 15% will be due, based on the value of the unauthorised payment

• The scheme sanction charge – see RPSM04104800

An income tax charge on the scheme administrator in respect of certain unauthorised payments in addition to the other two tax charges. The tax is due at a rate of 40%, based on the value of the payment. However, the rate may be reduced to as low as 15% where the unauthorised payments charge has been paid.