M1This Chapter shall have effect for the purposes of imposing, in the manner and to the extent therein provided, charges to F12corporation taxF1. . . in respect of gains to be treated in accordance with this Chapter as arising in connection with policies of life insurance, contracts for life annuities and capital redemption policies.

M4In this Chapter—

• “assignment”, in relation to Scotland, means an assignation;

• “capital redemption policy” means any F4contract effected in the course of a capital redemption business F16, within the meaning of Chapter 1 of Part 12;

• F7“charitable trust” means any trust established for charitable purposes only;

• F8“credit union” means a society registered as a credit union under the Industrial and Provident Societies Act 1965 or the Credit Unions (Northern Ireland) Order 1985;

• F9“excepted group life policy” shall be construed in accordance with subsection (2)(f) above;

• F10F3 “friendly society” means the same as in the Friendly Societies Act 1992 (and includes any society that by virtue of section 96(2) of that Act is to be treated as a registered friendly society within the meaning of that Act);

• F10“group life policy” means a policy of life insurance whose terms provide—

  1. a

     for the payment of benefits on the death of more than one individual; and

  2. b

     for those benefits to be paid on the death of each of those individuals;

• F13“life annuity” means—

  1. a

     any annuity to which section 656 (as read with section 657) applies, or

  2. b

     any annuity that—

     1. i

        is a purchased life annuity for the purposes of Chapter 7 of Part 4 of ITTOIA 2005 (see section 423 of that Act), and

     2. ii

        is not specified in section 718 of that Act (annuities the payments under which are not within section 717 of that Act (exemption for part of purchased life annuity payments)); and

• F11“non-charitable trust” means any trust other than a charitable trust.

References in this Chapter to assignment of the whole of, or assignment of part of or a share in, the rights conferred by a policy or contract shall, in any case where section 546A applies, be construed in accordance with that section.

M5For the purposes of this Chapter the falling due of a sum payable in pursuance of a right conferred by a policy or contract to participate in profits shall be treated as the surrender of rights conferred by the policy or contract.

M6This Chapter shall have effect only as respects policies of life insurance issued in respect of insurances made after 19th March 1968, contracts for life annuities entered into after that date, and capital redemption policies effected after that date.

A policy of life insurance issued in respect of an insurance made on or before 19th March 1968 shall be treated for the purposes of subsection (5) above and the following provisions of this Chapter as issued in respect of one made after that date if it is varied after that date so as to increase the benefits secured or to extend the term of the insurance.

A variation effected before the end of the year 1968 shall be disregarded for the purposes of subsection (6) above if its only effect was to bring into conformity with paragraph 2 of Schedule 9 to the Finance Act 1968 (which is re-enacted, as amended, by paragraph 2 of Schedule 15 to this Act) a policy previously conforming therewith except as respects the amount guaranteed on death, and no increase was made in the premiums payable under the policy.

F14. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

A policy of life insurance issued in respect of an insurance made before 14th March 1989 shall be treated for the purposes of sections 540(5A), 547(8) and 548(3A) as issued in respect of one made on or after that date if it is varied on or after that date so as to increase the benefits secured or to extend the term of the insurance; and any exercise of rights conferred by the policy shall be regarded for this purpose as a variation.