Tax Liability on Financial Services Compensation

Hi, I am a 69 year old single gentleman receiving State pension and a Small annuity on which I pay some tax. I have just been awarded a substantial sum (I don't want to post the actual sum on an open forum) by the Financial Services Compensation Board for a miss sold Pension Scheme back in 2011. The FSCS will be sending me a cheque for this amount in the next 10 working days so the letter says. Can you please advise the position regarding any tax liability due on this amount. If I do have a tax liability would this be on the whole sum or on the sum after legal expenses and how would I go about paying it please. Many thanks Southportpat

Hi,

Please refer to guidance at:

SAIM2340 - Interest: exemptions: compensation for mis-sold pensions

Thank you.