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HMRC internal manual

Employment Income Manual

Termination payments and benefits: Section 401 ITEPA 2003: scope of the charge: in connection with termination or change

Section 401(1) ITEPA 2003

Briefly, Section 401 ITEPA 2003 refers to payments and benefits received in connection with a termination of employment (or change in the duties of or earnings from the employment).

The full scope includes payments and benefits received

“directly or indirectly in consideration or in consequence of, or otherwise in connection with, the termination or change”.

This is a phrase of very wide scope, see EIM13910. For example, in HMRC v Colquhoun the phrase “otherwise in connection with” was equated with “in any way connected with”.