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There are special tax rules that apply to members of the regular UK armed forces, reserve and auxiliary forces, and members of visiting forces.

For all categories of UK service personnel, the basic rule is that all pay, pensions and other income is taxable as employment income, liable to national insurance contributions (NIC) and subject to PAYE. However, there are some particular exemptions for payments and benefits that would normally appear to be taxable. These are described below. Unless otherwise stated, exemptions for NIC also apply where there is an exemption from tax. For more, see Simon’s Taxes E4.746.