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HMRC internal manual

Business Income Manual

Specific deductions: crime (expenditure involving): blackmail and extortion: alternative basis for disallowance

A blackmail payment may sometimes also be disallowable because the payment itself is a criminal act; for example, in cases within the Terrorism Act 2000 - see BIM43120. However this will only happen where the payer knows or has reasonable cause to suspect that the payment will or may be used for the purposes of terrorism. The payer faced with a disallowance may claim that the threat was simply from a criminal rather than terrorist organisation. This will provide no escape from a disallowance where the payer has submitted to blackmail or extortion.