Income and Corporation Taxes Act 1988

4 [F2 (1) The amount referred to in paragraph 3 above shall be determined by the formula—

where—

A is the liabilities of the company’s overseas life assurance business at the end of the period of account,

[F3 B is the aggregate of—

(a) the appropriate part of the investment reserve at that time, and

(b) the appropriate part of any liabilities of the company’s [F4 long-term insurance fund] at that time which represent a money debt,]

C is the value, at that time, of any land in the United Kingdom which is an asset linked solely to the company’s overseas life assurance business, and

D is the relevant fraction of the value, at that time, of any land in the United Kingdom which is an asset linked both to the company’s overseas life assurance business and to some other category of business.]

[F5 (2) In sub-paragraph (1) above, in B, the “appropriate part" of the company’s investment reserve at the end of the period of account, or of any liabilities of its [F4 long-term insurance fund] at that time which represent a money debt, is—

(a) where none (or none but an insignificant proportion) of the liabilities of the company’s [F6 long-term] business at that time are with-profits liabilities, the part which bears to the whole the proportion A/B; and

(b) in any other case, the part which bears to the whole the proportion C/D.

• For this purpose—

• A is the amount of the liabilities of the company’s overseas life assurance business at the end of the period of account,

• B is the whole amount of the liabilities of the company’s [F6 long-term] business at that time,

• C is the amount of the with-profits liabilities of the company’s overseas life assurance business at that time, and

• D is the whole amount of the with-profits liabilities of the company’s long-term business at that time.]

[F7 (3) In this Schedule “land” includes buildings and other structures, land covered with water, and any estate, interest, easement, servitude, right or licence in or over land.

(4) In sub-paragraph (1) above, in D, “the relevant fraction” is the fraction of which—

(a) the numerator is the value, at the end of the period of account, of such of the liabilities of the company’s overseas life assurance business as were liabilities in respect of benefits to be determined by reference to the value of the asset; and

(b) the denominator is the value, at that time, of all the liabilities of the company’s [F6 long-term] business which were liabilities in respect of benefits to be so determined.]

[F8 (5) In this paragraph—

• “investment reserve", in relation to an insurance company, means the excess of the value of the assets of the company’s [F6 long-term] business over the aggregate of—

  (a)

  the liabilities of that business, and

  (b)

  any liabilities of the [F4 long-term insurance fund] which represent a money debt;

• “money debt" has the same meaning as in Chapter II of Part IV of the Finance Act 1996 M1 .]

Textual Amendments

F2 Sch. 19AA para. 4(1) substituted (10.1.1995 with effect in accordance with art. 1 of the amending S.I.) by The Overseas Life Assurance Fund (Amendment) Order 1994 (S.I. 1994/3278), art. 4(1)

F3 Sch. 19AA para. 4(1): definition of "B" substituted (1.9.2000 with effect in accordance with art. 1 of the amending S.I.) by The Overseas Life Assurance Fund (Amendment) Order 2000 (S.I. 2000/2188), art. 3(2)

F4 Words in Sch. 19AA para 4(1)(2)(5) substituted (1.12.2001 in accordance with art. 1(2)(a) of the amending S.I.) by The Financial Services and Markets Act 2000 (Consequential Amendments) (Taxes) Order 2001 (S.I. 2001/3629), art. 52(1)(k)(iii)

F5 Sch. 19AA para. 4(2) substituted (1.9.2000 with effect in accordance with art. 1 of the amending S.I.) by The Overseas Life Assurance Fund (Amendment) Order 2000 (S.I. 2000/2188), art. 3(3)

F6 Words in Sch. 19AA para 4(2)(a)(b)(4)(b)(5) substituted (1.12.2001 in accordance with art. 1(2)(a) of the amending S.I.) by The Financial Services and Markets Act 2000 (Consequential Amendments) (Taxes) Order 2001 (S.I. 2001/3629), art. 52(2)(m)(ii)

F7 Sch. 19AA para. 4(3)(4) inserted (10.1.1995 with effect in accordance with art. 1 of the amending S.I.) by The Overseas Life Assurance Fund (Amendment) Order 1994 (S.I. 1994/3278), art. 4(3)

F8 Sch. 19AA para. 4(5) inserted (1.9.2000 with effect in accordance with art. 1 of the amending S.I.) by The Overseas Life Assurance Fund (Amendment) Order 2000 (S.I. 2000/2188), art. 3(4)

Marginal Citations

M1 1996 c. 8.