Finance Act 2008

Commencement

7 (1) This paragraph applies where—

(a) the relevant company was a party to an investment life insurance contract immediately before the beginning of the first accounting period of the company beginning on or after 1 April 2008,

(b) at all times since the contract was made the rights conferred by the contract have been in the beneficial ownership of the company,

(c) the company brings into account credits and debits in respect of the contract on the basis of fair value accounting, and

(d) the relevant amount exceeds the fair value of the contract immediately before the beginning of that accounting period.

(2) In sub-paragraph (1)(d) “the relevant amount” means—

(a) where section 541 of ICTA applies on the deemed surrender under paragraph 6(1), the amount specified in sub-paragraph (i) of subsection (1)(b) of that section less the amount or value of any relevant capital payments (as defined in subsection (5)(a) of that section), or

(b) where section 543 of that Act applies on that deemed surrender, the amount specified in sub-paragraph (i) of subsection (1)(a) of that section less the amount or value of any relevant capital payments (as defined in subsection (3) of that section).

(3) No amount is to be brought into account as a credit by virtue of paragraph 2 in relation to the contract except to the extent that the aggregate of—

(a) the amount of the credit, and

(b) the total of any other credits which have previously arisen in relation to the contract by virtue of that paragraph,

is greater than the excess mentioned in sub-paragraph (1)(d).