Armed Forces: Income Tax
The question
To ask the Chancellor of the Exchequer, whether he has made an assessment of the potential merits of changing the tax on the Longer Separation Allowance (a) to be tax-free (b) or to be taxed at the basic rate of tax regardless of whether the recipient's total pay is in a higher tax bracket.
Answered by Treasury
We recognise the significant impact that time away from home can have on Service personnel and their families.
The Longer Separation Allowance is paid to Service personnel who are required to live or work away from their families for extended periods, such as on longer exercises or operational deployments. Payments increase with the amount of separation experienced, so those who spend longer periods away from home receive higher levels of support.
The Longer Separation Allowance is treated as earnings, similar to salary, and is therefore taxed in the same way under the UK tax system. This approach is set out in tax legislation, which determines how different types of income are treated for tax purposes.
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