The Overseas Life Insurance Companies Regulations 2006

Modifications of the Income and Corporation Taxes Act

5.—(1) Modify section 76(1) (expenses of insurance companies) as follows.

(2) For subsection (3) substitute—

“(3) For the purposes of this section “expenses payable” means—

(a) where the company is a UK-authorised firm, expenses brought into account in the periodical return of the company for a period of account in line 12, 22 or 25 of Form 40 (the revenue account) in relation to the long-term business carried on by the company at a permanent establishment in the United Kingdom ;

(b) where the company is an EEA firm or a Treaty firm, so much of the expenses included in item II.8 or 9(a) of the profit and loss account included in IAD accounts as are attributable to a permanent establishment in the United Kingdom through which the company carries on life assurance business,

but does not include any of the amounts falling within subsections (4), (5) or (6).”.

(3) In subsection (7), in Step 2—

(a) in paragraph (b) omit “or”, and

(b) at the end insert—

“, or

(d) equal to the amount—

where—

• S1 is the amount given by Step 1,

• FOTRA is the amount of any profits and gains arising from a FOTRA security, or from any loan relationship represented by it (after applying the provisions of section 154(2) to (7) of the Finance Act 1996), excluded by virtue of the tax exemption condition of that security,

• TBLAGAB means the income from the investments of an overseas life insurance company referable in accordance with section 432A to the basic life assurance and general annuity business of the permanent establishment in the United Kingdom through which the company carries on life assurance business, and

• “FOTRA security” and “tax exemption condition” have the same meaning as in section 154(8) of the Finance Act 1996.”.

(4) In subsection (11), in the definition of “the relevant income”—

(a) in paragraph (a), at the end insert “to the extent such income and gains fall to be attributed, for the purposes of section 11AA(2), to the permanent establishment in the United Kingdom through which the company carries on life assurance business”,

(b) in paragraph (b), at the end insert “to the extent such distributions fall to be attributed, for the purposes of section 11AA(2), to the permanent establishment in the United Kingdom through which the company carries on life assurance business.”.

(1)

Section 76 was substituted by section 40(1) of the Finance Act 2004 (c. 12) and amended by sections 42 and 70 of, and paragraph 1 of Schedule 9 and Part 2(10) of Schedule 11 to, the Finance (No. 2) Act 2005.