Section 1031Q Maintenance where relationship between cohabitants ends

(1) In this section—

“maintenance arrangement” means an order of a court under section 175 of the Civil Partnership and Certain Rights and Obligations of Cohabitants Act 2010 giving rise to a legally enforceable obligation;

“payment” means a payment or part of a payment, as the case may be.

(2)(a) This section applies to payments made directly or indirectly by a qualified cohabitant under or pursuant to a maintenance arrangement.

(b) For the purposes of this section a payment, whether conditional or not, which is made directly or indirectly by a qualified cohabitant under or pursuant to a maintenance arrangement shall be deemed to be made for the benefit of the other qualified cohabitant.

(3) Notwithstanding anything in the Income Tax Acts, as respects any payment to which this section applies made directly or indirectly by an individual under or pursuant to a maintenance arrangement for the benefit of a qualified cohabitant—

(a) the individual making the payment—

(i) shall not be entitled on making the payment to deduct and retain out of the payment any sum representing any amount of income tax on the payment, and

(ii) shall, if he or she makes a claim in that behalf in the manner prescribed by the Income Tax Acts, be entitled, for the purposes of those Acts, to deduct the payment in computing his or her total income for the year of assessment in which the payment is made,

and

(b) the payment shall be deemed for the purposes of the Income Tax Acts to be profits or gains arising to the qualified cohabitant, and income tax shall be charged on that qualified cohabitant under Case IV of Schedule D in respect of those profits or gains.

(4)(a) Subsections (1) and (2) of section 459 and section 460 shall apply to a deduction under subsection (3)(a)(ii) as they apply to any allowance, deduction, relief or reduction under the provisions specified in the Table to section 458.

(b) Subsections (3) and (4) of section 459 and paragraph 8 of Schedule 28 shall, with any necessary modifications, apply in relation to a deduction under subsection (3)(a)(ii).