The Horizon Convictions Redress Scheme (Amendment) and Grenfell Support (Restorative Justice) Programme (Income Tax Exemption) Regulations 2025
The regulations amended the Horizon Convictions Redress Scheme and exempted Grenfell Support (Restorative Justice) Programme payments from income tax.
These regulations amend the Horizon Convictions Redress Scheme to expand its eligibility criteria for compensation, encompassing convictions quashed by courts or legislation, cautions, and alternative-to-prosecution outcomes related to the Horizon system.
The amendments also provide income tax exemptions for payments made under the Grenfell Support (Restorative Justice) programme to victims of the Grenfell Tower fire. Both changes have retrospective application.
Arguments For
Expanding eligibility for Horizon Redress: The amendment broadens the scope of the Horizon Convictions Redress Scheme to encompass individuals who faced various forms of legal action related to the Horizon system, including those with quashed convictions, cautions, alternative-to-prosecution measures, or even those prosecuted but not convicted. This ensures a more inclusive and equitable approach to compensation.
Providing tax relief for Grenfell victims: The regulations provide income tax exemption for restorative justice payments received by individuals affected by the Grenfell Tower fire. This offers crucial financial assistance and acknowledges the significant suffering experienced by these individuals.
Supporting restorative justice initiatives: The tax relief for Grenfell victims shows government support for restorative justice programs. Such funding mechanisms highlight efforts to address past injustices and aid healing and reconciliation.
Addressing past injustices resulting from Horizon system: The revisions to the Horizon compensation show intent to redress the injustices stemming from the flawed Horizon system and fairly compensate those who suffered unduly.
Arguments Against
Potential administrative burden: Expanding the eligibility criteria for the Horizon Redress Scheme and administering the Grenfell tax exemption may cause increased administrative complexities for the relevant government bodies.
Cost implications: The cost of providing broadened compensation under the Horizon Redress Scheme warrants thorough evaluation. Similarly, the financial impact of the Grenfell tax exemption needs assessment.
Alternative approaches to compensation: Alternative compensation or redress mechanisms for the affected groups, besides tax relief, could be considered and evaluated for efficiency and effectiveness.
Potential for unintended consequences: Broadening the eligibility criteria could lead to an increased number of applications and claims, potentially overwhelming system resources and delaying payments to legitimately affected individuals.
- Citation and commencement These Regulations may be cited as the Horizon Convictions Redress Scheme (Amendment) and Grenfell Support (Restorative Justice) Programme (Income Tax Exemption) Regulations 2025 and come into force on 7th August 2025.
The regulations are titled "Horizon Convictions Redress Scheme (Amendment) and Grenfell Support (Restorative Justice) Programme (Income Tax Exemption) Regulations 2025", and they will take effect on August 7th, 2025.
- Amendment of the Horizon Convictions Redress Scheme and Horizon Shortfall Scheme Fixed Sum Award (Tax Exemptions and Relief) Regulations 2024 (1) The Horizon Convictions Redress Scheme and Horizon Shortfall Scheme Fixed Sum Award (Tax Exemptions and Relief) Regulations 2024 are amended as follows. (2) In regulation 2(1) (interpretation), in the definition of “Horizon Convictions Redress Scheme compensation payment”— (a) after “to a person” insert “eligible for compensation”; (b) for “to compensate people who have a conviction involving the Horizon system quashed by legislation” substitute—"and who—" (a) had a conviction involving the Horizon system quashed by legislation, (b) had a conviction involving the Horizon system quashed by a court, (c) received a caution of any kind for an offence involving the Horizon system, (d) in Scotland received an alternative to prosecution within the definition given in section 4(5) of the Post Office (Horizon System) Offences (Scotland) Act 2024 or received a purported alternative to prosecution from the Post Office Limited, or (e) was the subject of a criminal prosecution involving the Horizon system but was not convicted. (3) In regulation 3(2) (income tax exemption) at the end insert “subject to paragraph (3)”. (4) After regulation 3(2), insert— (3) For payments within sub-paragraphs (b), (c), (d) and (e) of the definition of “Horizon Convictions Redress Scheme compensation payment”, this regulation applies to payments received on or after 3rd June 2025. (5) In regulation 4(2) (capital gains tax exemption) at the end insert “subject to paragraph (3)”. (6) After regulation 4(2), insert— (3) For payments within sub-paragraphs (b), (c), (d) and (e) of the definition of “Horizon Convictions Redress Scheme compensation payment”, this regulation applies to disposals made on or after 3rd June 2025. (7) In regulation 5(2) (inheritance tax relief) at the end insert “subject to paragraph (3)”. (8) After regulation 5(2), insert— (3) For payments within sub-paragraphs (b), (c), (d) and (e) of the definition of “Horizon Convictions Redress Scheme compensation payment”, this regulation applies to deaths occurring on or after 3rd June 2025.
This section amends the 2024 regulations concerning the Horizon Convictions Redress Scheme.
The definition of "Horizon Convictions Redress Scheme compensation payment" is broadened.
It now includes payments to those whose convictions were quashed (by court or legislation), received cautions, received alternative-to-prosecution measures in Scotland, or were prosecuted but not convicted.
Income tax, capital gains tax, and inheritance tax exemptions for these payments are clarified for dates after June 3rd, 2025.
The changes add eligibility to individuals' cases involving the Horizon system.
- Exemption from income tax for payments made under the Grenfell Support (Restorative Justice) programme (1) A payment made by the Royal Borough of Kensington and Chelsea under the Grenfell Support (Restorative Justice) programme as a result of a person’s eligibility, is a qualifying payment for the purposes of paragraph 3 of Part 1 of Schedule 15 to the Finance Act 2020. (2) In this regulation, “Grenfell Support (Restorative Justice) programme” means the scheme approved by the Royal Borough of Kensington and Chelsea on 5th June 2024 for people who were affected by the fire at Grenfell Tower on 14th June 2017. (3) This regulation has effect in relation to payments received on or after 5th June 2024.
This section exempts from income tax payments made to eligible individuals through the Grenfell Support (Restorative Justice) programme.
The programme, approved on June 5th, 2024, assists those affected by the Grenfell Tower fire (June 14th, 2017).
The income tax exemption is retrospective to payments received on or after June 5th, 2024.
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