Income protection provides support when you need it most. If you have an income protection policy in place, you're probably already wondering if you'll need to pay income tax on your pay out. This depends on two outcomes: If you have a personal Income Protection plan: You won’t have to pay tax on the money you receive as part of your claim as the maximum benefit is already limited (usually up to 65% of your annual salary)   If you have a plan through work or your own company: If your income protection plan is paid through your business or a business you work for, then if you claim, your payout is paid via PAYE and therefore taxed as usual. These plans are also normally known as Executive Income Protection and typically have a higher benefit. Please see our Business Protection page for more information.