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HMRC internal manual

Business Income Manual

Sale of income by an individual in exchange for capital: occupation

S774 Income Tax Act 2007

‘Occupation’ embraces all activities that are of a kind pursued in any profession or vocation, irrespective of whether the individual is in fact carrying on a profession or vocation or is an employee or office-holder. Thus, although the individual may be an employee of, for example, his service company, if the activities which he performs in the course of his employment are of a kind which are performed as part of a profession or vocation, those activities are within the meaning of ‘occupation’ for the purposes of the sale of income provisions.

The use of the word ‘vocation’ in the definition brings in activities that do not fall within the normal meaning of the word ‘profession’. For example, a jockey may well be carrying on a vocation without carrying on a profession. The words ‘profession or vocation’ embrace not only actors, actresses, pop stars and the usual TV and film personalities but also such people as golfers, tennis players, footballers, boxers and so on.