Question to the HM Treasury:

To ask His Majesty's Government which (1) social security, and (2) other taxpayer-funded benefits, are (a) taxable, and (b) tax-free.

The long-standing tax treatment of social security benefits is based on how each type of payment would otherwise be treated in income tax legislation.

Whether a benefit is taxable or exempt from income tax is set out in the Income Tax (Earnings and Pensions) Act 2003 (ITEPA).

The position for the most common UK state benefits is summarised online at gov.uk^[1].

The most common taxable State benefits include Bereavement Allowance, Carer’s Allowance, contribution- based Employment and Support Allowance (ESA), Incapacity Benefit, Jobseeker’s Allowance (JSA), pensions paid by the Industrial Death Benefit scheme, the State Pensions, and Widowed Parent’s Allowance. For an extensive list of taxable UK benefits please refer to section 660^[2] ITEPA.

The most common tax-exempt state benefits include Attendance Allowance, Bereavement support payment, Child Benefit, Child Tax Credit, Disability Living Allowance (DLA), Guardian’s Allowance, Housing Benefit, income-related Employment and Support Allowance (ESA), Industrial Injuries Benefit, Maternity Allowance, Pension Credit, Personal Independence Payment (PIP), Severe Disability Allowance, Universal Credit, War Widow’s Pension, Winter Fuel Payments, and Working Tax Credit. An extensive list of UK social security benefits wholly exempt from income tax can be found at section 677^[3] ITEPA.

[1] www.gov.uk/income-tax/taxfree-and-taxable-state-benefits

[2] Income Tax (Earnings and Pensions) Act 2003 (legislation.gov.uk)

[3] Income Tax (Earnings and Pensions) Act 2003 (legislation.gov.uk)