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HMRC internal manual

Employment Income Manual

HM Revenue & Customs
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Tax treatment of steel industry employees: redundancies

Steel Industry employees may be entitled to payments under schemes set up by the European Community (Iron and Steel Employees Re-adaptation Benefits Scheme).

The tax treatment of these payments is as follows:

### Type of payment ### Tax treatment
Payments to the employed, self-employed or unemployed. Taxable as employment income.
Payments during retraining. Taxable only under Section 403 ITEPA 2003.
Grants to employees who are transferred. Taxable as employment income but exemption for the first £8,000 of expenses may be available under Section 271 ITEPA 2003 (see EIM03103 and subsequent guidance).