(1)M1Subject to subsections (2) and (3) below, a member of a [F1friendly society or registered branch] shall not be entitled to have at any time outstanding contracts with any one or more such societies or branches (taking together all such societies or branches throughout the United Kingdom) for the assurance of—
(a)more than £750 by way of gross sum under tax exempt life or endowment business;
(b)more than £156 by way of annuity under tax exempt life or endowment business.
In any case where the member’s outstanding contracts were all made before 14th March 1984 this subsection shall have effect with the substitution for “£750” and “£156” of “ £2,000 ” and “ £416 ” respectively.
(2)Subsection (1)(a) above shall not apply as respects sums assured under contracts made after 31st August 1987.
(3)With respect to contracts for the assurance of gross sums under tax exempt life or endowment business, a member of a [F1friendly society or registered branch] shall not be entitled to have outstanding with any one or more such societies or branches (taking together all such societies or branches throughout the United [F2Kingdom)—
[F3(zza)contracts under which the total premiums payable in any period of 12 months exceed £270; or]
[F4(za)contracts [F5made before the day on which the Finance Act 1995 was passed and] under which the total premiums payable in any period of 12 months exceed £200; or]]
(a)contracts [F6made before the day on which the Finance Act 1991 was passed and] under which the total premiums payable in any period of 12 months exceed £150; or
(b)contracts made before 1st September 1990 under which the total premiums payable in any period of 12 months exceed £100,
unless all those contracts were made before 1st September 1987.
(4)In applying the [F2limits] in subsection (3) above, the premiums under any contract for an annuity which was made before 1st June 1984 by a new society shall be brought into account as if the contract were for the assurance of a gross sum.
[F7(4A)Subsection (4B) below applies to contracts for the assurance of gross sums under tax exempt life or endowment business made after 31st August 1987 and before the day on which [F8the Finance Act 1995] was passed.
(4B)Where the amount payable by way of premium under a contract to which this subsection applies is increased by virtue of a [F9 variation made—
(a)in the period beginning with 25th July 1991 and ending with 31st July 1992, or
(b)in the period beginning with the day on which the Finance Act 1995 was passed and ending with 31st March 1996,
the contract shall, for the purposes of subsection (3) above, be treated, in relation to times when the contract has effect as varied, as made at the time of the variation.]]
(5)In applying the limits in this section there shall be disregarded—
(a)any bonus or addition which either is declared upon assurance of a gross sum or annuity or accrues upon such an assurance by reference to an increase in the value of any investments;
(b)any approved annuities as defined in section 620(9) or any policy of insurance or annuity contract by means of which the benefits to be provided under an occupational pension scheme as defined in [F10section 1 of the Pension Schemes Act 1993] are secured;
(c)any increase in a benefit under a friendly society contract, as defined in section 6 of the M2Decimal Currency Act 1969, resulting from the adoption of a scheme prescribed or approved in pursuance of subsection (3) of that section; and
(d)so far as concerns the total premiums payable in any period of 12 months—
(i)10 per cent. of the premiums payable under any contract under which the premiums are payable more frequently than annually; and
(ii)£10 of the premiums payable under any contract made before 1st September 1987 by a [F11friendly society other than] a new society; and
(iii)so much of any premium as is charged on the ground that an exceptional risk of death is involved.
(6)In applying the limits in this section in any case where a member has outstanding with one or more society or branch one or more contracts made after 13th March 1984 and one or more contracts made on or before that date, any contract for an annuity which was made before 1st June 1984 by a new society shall be regarded not only as a contract for the annual amount concerned but also as a contract for the assurance of a gross sum equal to 75 per cent. of the total premiums which would be payable under the contract if it were to run for its full term or, as the case may be, if the member concerned were to die at the age of 75 years.
(7)A [F12friendly society or registered branch] may require a member to make and sign a statutory declaration that the total amount assured under outstanding contracts entered into by that member with any one or more [F12friendly societies or registered branches] (taking together all such societies or branches throughout the United Kingdom) does not exceed the limits applicable by virtue of this section and that the total premiums under those contracts do not exceed those limits.
Textual Amendments
F1Words in s. 464(1)(3) substituted (19.2.1993) by Finance (No. 2) Act 1992 (c. 48), s. 56, Sch. 9 para. 11(2); S.I. 1993/236, art. 2
F21990 s.49(3), (4) Previously "Kingdom) contracts under which the total premiums payable in any period of 12 months exceed £100 unless all those contracts were entered into before 1st September 1987" and "limit" respectively
F3S. 464(3)(zza) inserted (1.5.1995) by Finance Act 1995 (c. 4), Sch. 10 para. 2(2)
F5Words in s. 464(3)(za) inserted (1.5.1995) by Finance Act 1995 (c. 4), Sch. 10 para. 2(3)
F6Words in s. 464(3)(a) inserted by Finance Act 1991 (c. 31, SIF 63:1), s. 50, Sch. 9 para. 3(3)
F8Words in s. 464(4A) substituted (1.5.1995) by Finance Act 1995 (c. 4), Sch. 10 para. 2(4)
F9Words in s. 464(4B) substituted (1.5.1995) by Finance Act 1995 (c. 4), Sch. 10 para. 2(5)
F10Words in s. 464(5)(b) substituted (7.2.1994) by 1993 c. 48, ss. 190, 193(2)(3), Sch. 8 para. 20(1) (with ss. 6(8), 164); S.I. 1994/86, art. 2
F11Words in s. 464(5)(d)(ii) substituted (19.2.1993) by Finance (No. 2) Act 1992 (c. 48), s. 56, Sch. 9 para. 11(3); S.I. 1993/236, art. 2
F12Words in s. 464(7) substituted (19.2.1993) by Finance (No. 2) Act 1992 (c. 48), s. 56, Sch. 9 para. 11(4); S. I. 1993/236, art. 2
Modifications etc. (not altering text)
C1S. 464: power to amend conferred (7.2.1994) by 1993 c. 48, ss. 162, 193(2)(3) (with ss. 6(8), 164); S. I. 1994/86, art. 2
Marginal Citations
M1Source—FSA 1974 s.64(1), (2), (2A), (6); 1985 s.41(1), (2); 1984 s.73(5), (6); 1976/598; FSA 1984 s.2; 1987 s.30(4), (5), (7)