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HMRC internal manual

Business Income Manual

HM Revenue & Customs
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Specific deductions: compensation & damages: contents

Compensation may arise in a variety of circumstances. This chapter describes the tax treatment of payments and receipts for trading income purposes and covers the following:

For other guidance, see:

  • BIM62025 - compensation paid for damages caused by mining operations
  • BIM40100 onwards and EIM12852 - treatment of compensation or damages in the hands of the recipient
  • BIM51425 - compensation payments by brewers to tenants of tied houses