Finance Act 1989

in subsection (3) (increased allowance for those aged 80 and over) for “80”, wherever occurring, there shall be substituted “75”, and

in subsection (5) (age allowance withdrawn by two-thirds of amount by which income exceeds a specified limit) for “two-thirds” there shall be substituted “one half”.

for “80” there shall be substituted “75”, and

for “£3,310” there shall be substituted “£3,540”.

for “£10,600” there shall be substituted “£11,400”,and

for “two-thirds” there shall be substituted “one half”.

for “80” there shall be substituted “75”, and

for “£1,895” there shall be substituted “£2,025”.

for “£10,600” there shall be substituted “£11,400”,and

for “two-thirds” there shall be substituted “one half”.

the small companies’ rate shall be 25 per cent., and

the fraction mentioned in section 13(2) of the Taxes Act 1988 (marginal relief for small companies) shall be one fortieth.

for “£100,000” there shall be substituted “£150,000”, and

for “£500,000” there shall be substituted “£750,000”.

it must be assumed, in making the calculation, that any remuneration which is unpaid when the calculation is made will not be paid before the end of that period, but

if the remuneration is subsequently paid before the end of that period, the calculation is adjusted if a claim to adjust it is made to an officer of the Board within 2 years beginning with the end of the period of account.

is treated as received by an employee for the purposes of the Income Tax (Earnings and Pensions) Act 2003 by section 18, 19, 31 or 32 of that Act (receipt of money and non-money earnings), or

would be so treated if it were not exempt income.

it must be assumed, in making the calculation, that any remuneration which is unpaid when the calculation is made will not be paid before the end of that period, but

if the remuneration is subsequently paid before the end of that period, the calculation is adjusted if a claim to adjust it is made to an officer of the Board by or on behalf of the company within 2 years beginning with the end of the period of account.

is treated as received by an employee for the purposes of the Income Tax (Earnings and Pensions) Act 2003 by section 18, 19, 31 or 32 of that Act (receipt of money and non-money earnings), or

would be so treated if it were not exempt income.

any reference in this section to an amount being deductible under section 75 of the Taxes Act 1988 as expenses of management shall be taken as a reference to an amount being brought into account under section 76 of that Act as expenses payable and references to a deduction shall be construed accordingly;

subsection (4) above shall have effect subject to section 86 below, and

in construing section 86 below the remuneration shall be treated as expenses payable for that period which fall to be included at Step 1 in section 76(7) of the Taxes Act 1988.

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the words “ employment to which Chapter II of Part V applies ”shall be substituted for the words from “director’s” to “section167)” in F48section 418(3)(a) of that Act;

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on or after 6th April 1990 an individual makes a payment in respect of a premium under a contract of private medical insurance (whenever issued),

the contract meets the requirement in subsection (2) below as to the person or persons insured,

at the time the payment is made the contract is an eligible contract,

the individual making the payment does not make it out of resources provided by another person for the purpose of enabling it to be made, and

the individual making the payment is not entitled to claim any relief or deduction in respect of it under any other provision of the Tax Acts.

an individual who at the time the payment is made is aged 60 or over and resident in the United Kingdom,

individuals each of whom at that time is aged 60 or over and resident in the United Kingdom, or

two individuals who are married to each other at that time, at least one of whom is aged 60 or over at that time, and each of whom is resident in the United Kingdom at that time.

a payment is made in respect of a premium under a contract at a time when the contract meets the requirement in subsection (2) above by virtue of paragraph (c) of that subsection, and

a payment is made under the same contract at a time after one of the individuals has died and when the contract does not (apart from this subsection) meet the requirement in subsection (2) above by virtue only of the fact that the surviving spouse is not aged 60 or over at the time,

in accordance with subsections (3A) to (3C) below, and

only on a claim made for the purpose.

the amount found under subsection (3B) below, and

the amount which reduces his liability to nil.

taking the amount of the payment referred to in subsection (3A) above or (as the case may be) the aggregate amount of the payments there referred to, and

finding an amount equal to tax on the amount taken under paragraph (a) above at the basic rate for the year of assessment concerned.

any income tax reduction under Chapter I of Part VII of the Taxes Act 1988 or under section 347B of that Act;

any income tax reduction under section 353(1A) of the Taxes Act 1988;

any relief by way of a reduction of liability to tax which is given in accordance with any arrangements having effect by virtue of section 788 of the Taxes Act 1988 or by way of a credit under section 790(1) of that Act;

any tax at the basic rate on so much of that person’s income as is income the income tax on which he is entitled to charge against any other person or to deduct, retain or satisfy out of any payment.

shall accept the amount paid after deduction in discharge of the individual’s liability to the same extent as if the deduction had not been made, and

may, on making a claim F53in accordance with regulations, recover from the Board an amount equal to the amount deducted.

an individual who has made a payment in respect of a premium under a contract of private medical insurance shall cease to be and be treated as not having been entitled to relief under subsection (3) above; and

he or the person to whom the payment was made (depending on the terms of the regulations) shall account to the Board for tax from which relief has been given on the basis that the individual was so entitled.

references to a premium, in relation to a contract of insurance, are to any amount payable under the contract to the insurer, and

references to an individual who is resident in the United Kingdom at anytime include references to an individual who is at that time performing duties which are treated by virtue of section 132(4)(a) of the Taxes Act 1988 as performed in the United Kingdom.

it was entered into by an insurer who at the time it was entered into was a qualifying insurer and was approved by the Board for the purposes of this section,

the period of insurance under the contract does not exceed one year(commencing with the date it was entered into),

at the relevant time the contract satisfies the conditions set out in subsection (2A) below,

the contract is not one in the case of which subsection (2D) below applies,

the contract is not connected with any other contract at the relevant time and has not been connected with any other contract at any time since it was entered into, F56and

no benefit has been provided by virtue of the contract other than an approved benefit, F57and

the contract meets one or more of the three conditions set out below.

the contract either provides indemnity in respect of all or any of the costs of all or any of the treatments, medical services and other matters for the time being specified in regulations made by the Treasury, or in addition to providing indemnity of that description provides cash benefits falling within rules for the time being so specified,

the contract does not confer any right other than such a right as is mentioned in paragraph (a) above or is for the time being specified in regulations made by the Treasury,

the premium under the contract is reasonable, and

the contract satisfies such other requirements as are for the time being specified in regulations made by the Treasury.

at the relevant time the contract confers a material right, or more than one such right, but

the total cost to the insurer of providing benefits in pursuance of the material right or (as the case may be) in pursuance of all the material rights would not exceed the prescribed sum,

is not a right such as is mentioned in subsection (2A)(a) above or such as is for the time being specified in regulations made under subsection (2A)(b) above, and

is not a right to a cash benefit.

at least one other contract is entered into which is a contract (a collateral contract) under which a benefit is provided in consideration of the insured’s entering into the main contract, and

the cost to the insurer of fulfilling his obligations under the collateral contract (or, if there is more than one collateral contract, of fulfilling his obligations under all of them) exceeds the prescribed sum.

which were (at the time the contract was entered into) certified by the Board as compatible with an eligible contract when made to that standard form, and

which (at that time) satisfied any conditions subject to which the additions were so certified.

they are simultaneously in force at that time,

either of them was entered into with reference to the other, or with a view to enabling the other to be entered into on particular terms, or with a view to facilitating the other being entered into on particular terms, and

the terms on which either of them was entered into would have been significantly less favourable to the insured if the other had not been entered into.

an insurer lawfully carrying on in the United Kingdom business of any of the classes specified in Part I of Schedule 2 to the M8Insurance Companies Act 1982;

an insurer not carrying on business in the United Kingdom but carrying on business in another member State and being either a national of a member State or a company or partnership formed under the law of any part of the United Kingdom or another member State and having its registered office, central administration or principal place of business in a member State.

mentioned in subsection (2A)(a) above, or

for the time being specified in regulations made under subsection (2A)(b) above.

it is a single benefit provided otherwise than as mentioned in subsection (9) above and the cost to the insurer of providing it does not exceed the prescribed sum, or

it is one of a number of benefits provided otherwise than as mentioned in subsection (9) above and the total cost to the insurer of providing the benefits does not exceed the prescribed sum.

the contract either provides indemnity in respect of all or any of the costs of all or any of the treatments, medical services and other matters for the time being specified in regulations made by the Treasury, or in addition to providing indemnity of that description provides cash benefits falling within rules for the time being so specified,

the contract does not confer any right other than such a right as is mentioned in paragraph (a) above or is for the time being specified in regulations made by the Treasury,

the premium under the contract is in the Board’s opinion reasonable, and

the contract satisfies such other requirements as are for the time being specified in regulations made by the Treasury.

the insurer, or

any person who (if the policy were certified) would be entitled to relief under section 54 above.

provide that a claim under section 54(3) or (6)(b) above shall be made in such form and manner, shall be made at such time, and shall be accompanied by such documents, as may be prescribed;

make provision for and with respect to appeals against a decision of an officer of the Board or the Board with respect to a claim under section 54(6)(b) above;

make provision, in relation to payments in respect of which a person is entitled to relief under section 54 above, for the giving by insurers in such circumstances as may be prescribed of certificates of payment in such form as may be prescribed to such persons as may be prescribed;

provide that a person who provides (or has at any time provided) insurance under contracts of private medical insurance shall comply with any notice which is served on him by the Board and which requires him within a prescribed period to make available for the Board’s inspection documents (of a prescribed kind) relating to such contracts;

provide that persons of such a description as may be prescribed shall, within a prescribed period of being required to do so by the Board, furnish to the Board information (of a prescribed kind) about contracts of private medical insurance;

make provision with respect to the approval of insurers for the purposes of section 55 above and the withdrawal of approval for the purposes of that section;

make provision for and with respect to appeals against decisions of the Board with respect to the giving or withdrawal of approval of insurers for the purposes of section 55 above;

make provision with respect to the certification by the Board of standard forms of eligible contract and variations from standard forms of eligible contract certified by them;

make provision for and with respect to appeals against decisions of the Board with respect to the certification of standard forms of eligible contractor variations from standard forms of eligible contract certified by them;

provide that certification, or the revocation of a certification, under section 56 above shall be carried out in such form and manner as may be prescribed;

make provision with respect to appeals against decisions of the Board with respect to certification or the revocation of certification under section 56 above;

make provision generally as to administration in connection with sections 54 to 56 above.

section 29(1)(c) (excessive relief) as it has effect apart from section 29(2) to (10) of that Act;

section 30 (tax repaid in error etc.) F66apart from subsection (1B),

F67section 86 (interest), and

section 95 (incorrect return or accounts),

in a case where the person falling within section 54(6) above has made any interim claim, within the meaning of regulations made under subsection (1) and section 54(4) above, as respects some part of the year of assessment for which the assessment is made, is 1st January in that year of assessment; and

a company expends a sum in making a payment by way of contribution to the trustees of a trust which is a qualifying employee share ownership trust at the time the sum is expended,

at that time, the company or a company which it then controls has employees who are eligible to benefit under the terms of the trust deed,

at that time the company is resident in the United Kingdom,

before the expiry of the expenditure period the sum is expended by the trustees for one or more of the qualifying purposes, and

before the end of the claim period a claim for relief under this section is made.

shall be deducted in computing for the purposes of Schedule D the F79profits of a trade carried on by the company, or

if the company is an investment company or a company in the case of which section 75 of the Taxes Act 1988 applies by virtue of section 76 of that Act, shall be treated as expenses of management.

the acquisition of shares in the company which established the trust;

the repayment of sums borrowed;

the payment of interest on sums borrowed;

the payment of any sum to a person who is a beneficiary under the terms of the trust deed;

the meeting of expenses.

the trustees shall be treated as receiving, when the event occurs, F80income of an amount that is equal to the chargeable amount (within the meaning of section 70 below),

that income shall be chargeable to income tax for the year of assessment in which the event occurs,

the tax so chargeable shall be charged on the full amount of the income the trustees are treated as receiving in the year of assessment F82, and

the trustees are liable for any tax so chargeable, F83...

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any interest which is due on the tax or the part (as the case may be) and has not been paid by the trustees, and

any interest accruing due on the tax or the part (as the case may be)after the date of service,

the company which established the employee share ownership trust;

any company falling within subsection (7) below.

it has paid a sum to the trustees, and

the sum has been deducted as mentioned in section 67(2)(a) above or treated as mentioned in section 67(2)(b) above.

the transfer of securities by the trustees, if the transfer is not a qualifying transfer;

the transfer of securities by the trustees to persons who are at the time of the transfer beneficiaries under the terms of the trust deed, if the terms on which the transfer is made are not qualifying terms;

the retention of securities by the trustees at the expiry of the F85qualifying period beginning with the date on which they acquired them;

the expenditure of a sum by the trustees for a purpose other than a qualifying purpose.

it is made to the trustees of a scheme which at the time of the transfer is a profit sharing scheme approved under Schedule 9 to the Taxes Act 1988, and

it is made for a consideration which is not less than the price the securities might reasonably be expected to fetch on a sale in the open market.

it is a transfer of relevant shares made to the trustees of the plan trust of F88a share incentive plan,

the plan is approved under F89Schedule 2 to the Income Tax (Earnings and Pensions) Act 2003 when the transfer is made, and

the consideration (if any) for which the transfer is made does not exceed the market value of the shares.

the trustees transfer or dispose of part of a holding of shares (whether by way of a qualifying transfer or otherwise), and

the holding includes any relevant shares,

“ original funds ” means any money held by the trustees of the employee share ownership trust in a bank or building society account at midnight on 20th March 2000, and

any payment made by the trustees after that time (whether to acquire shares or otherwise) shall be treated as made out of original funds (and not out of money received after that time) until those funds are exhausted.

all the securities transferred at the same time F92other than those transferred on a transfer such as is mentioned in subsection (4ZA) below are transferred on similar terms,

securities have been offered to all the persons who are beneficiaries under the terms of the trust deed F93by virtue of a rule which conforms with paragraph 4(2), (3) or (4) of Schedule 5 to this Act when the transfer is made, and

securities are transferred to all such F94persons who have accepted.

it is made to a person exercising a right to acquire shares, and

that right is being exercised in accordance with the provisions of that scheme, and

the consideration for the transfer is payable to the trustees.

seven years, in the case of trusts established on or before the day on which the Finance Act 1994 was passed;

twenty years, in the case of other trusts;

the acquisition of shares in the company which established the trust;

the repayment of sums borrowed;

the payment of interest on sums borrowed;

the payment of any sum to a person who is a beneficiary under the terms of the trust deed;

the meeting of expenses.

beginning with the qualifying transfer mentioned in that paragraph, and

ending nine months after the end of the period of account in which that qualifying transfer took place.

For this purpose the period of account means the period of account of the company that established the employee share ownership trust.

acquire securities when they become entitled to them (subject to the exceptions in subsection (9) below);

transfer securities to another person when that other becomes entitled to them;

retain securities if they remain entitled to them.

if securities are issued to trustees in exchange in circumstances mentioned in section F101135(1) of the Taxation of Chargeable Gains Act 1992, they shall be treated as having acquired them when they became entitled to the securities for which they are exchanged;

if trustees become entitled to securities as a result of a reorganisation, they shall be treated as having acquired them when they became entitled to the original shares which those securities represent (construing “reorganisation” and “original shares” in accordance with section F101126 of that Act).

shares;

debentures.

if the event constitutes a disposal of the securities by the trustees for the purposes of the F102Taxation of Chargeable Gains Act 1992, the chargeable amount is an amount equal to the sums allowable under section F10238(1)(a) and (b) of that Act;

if the event does not constitute such a disposal, the chargeable amount is an amount equal to the sums which would be so allowable had the trustees made a disposal of the securities for the purposes of that Act at the time the chargeable event occurs.

the amount of the consideration received for the qualifying transfer mentioned in section 69(1)(e) above, less

the amount of any expenditure by the trustees for a qualifying purpose during the period mentioned in section 69(5A) above.

a chargeable event (within the meaning of section 69 above) occurs in relation to the trustees of an employee share ownership trust,

at the time the event occurs anything is outstanding in respect of the principal of an amount or amounts borrowed at any time by the trustees, and

the chargeable event is one as regards which section 72(2)(b) below applies.

“the initial chargeable event” means the event referred to in subsection (1)(a) above, and

“the total outstanding amount” means the total amount outstanding, at the time the initial chargeable event occurs, in respect of the principal of an amount or amounts borrowed at any time by the trustees.

the trustees shall be treated as receiving, when the further event occurs, F104income of an amount that is equal to the chargeable amount,

that income shall be chargeable to income tax for the year of assessment at the end of which the further event occurs,

the tax so chargeable shall be charged on the full amount of the income the trustees are treated as receiving in the year of assessment F106, and

the trustees are liable for any tax so chargeable, F107...

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the aggregate of the total outstanding amount repaid in the year of assessment, and

an amount found by applying the formula A-B-C.

A is the amount which would be the chargeable amount for the initial chargeable event apart from section 72(2) below,

B is the chargeable amount for the initial chargeable event, and

C is the amount (if any) found under subsection (8) below.

a chargeable event (within the meaning of section 69 above) occurs in relation to the trustees in circumstances mentioned in subsection (1) above,

a sum falls to be included in the total outstanding amount found for the time the event occurs,

another chargeable event (within the meaning of that section) occurs in relation to the trustees in circumstances mentioned in subsection (1) above, and

the same sum or a part of it would (apart from this subsection) fall to be included in the total outstanding amount found for the time the event occurs,

an event which is a chargeable event by virtue of section 69 above;

an event which is a chargeable event by virtue of section 71 above.

the amount which would (apart from this subsection) be the chargeable amount for the event in question shall be aggregated, for the purposes of paragraph (b) below, with the chargeable amounts for other chargeable events(if any) occurring in relation to the trustees before the event in question,

if the amount which would (apart from this subsection) be the chargeable amount for the event in question (or the aggregate found under paragraph (a)above, if there is one) exceeds the deductible amount, the chargeable amount for the event in question shall be the amount it would be apart from this subsection less an amount equal to the excess, and

section 70(2) and (3) and section 71(5) above shall have effect subject to paragraph (b) above.

it has been deducted as mentioned in section 67(2)(a) above, or treated as mentioned in section 67(2)(b) above, before the occurrence of that event, or

it would fall to be so deducted or treated if a claim for relief under section 67 above had been made immediately before the occurrence of that event.

sums received (including sums borrowed) by the trustees;

expenditure incurred by them;

assets acquired by them;

transfers of assets made by them.

that a sum has been so deducted or so treated, and

what sum has been so deducted or so treated.

bonus payments are made to them,

reversionary bonuses are declared in their favour, or

a reduction is made in the premiums payable by them.

in the case of bonus payments, the amount of the payments,

in the case of declared reversionary bonuses, the amount of the liabilities assumed by the company in consequence of the declaration, and

in the case of a reduction in premiums, the amount of the liabilities assumed by the company in consequence of the reduction.

may make different provision for different cases, and

may include provision having effect in relation to periods of account during which they are made.

at the end of the period of account in question the company has an unappropriated surplus on valuation as shown in the return deposited with the Financial Services Authority under section 9.6 of the Prudential Sourcebook (Insurers) (an “ unappropriated surplus ”), and

the company has not made an election in accordance with F115Rule 9.10(c) of the Prudential Sourcebook (Insurers) covering the period of account in question.

if so much of the unappropriated surplus at the end of the period of account in question as is required to meet the duty of fairness exceeds so much of the unappropriated surplus at the end of that immediately preceding period of account as was required to meet that duty, the excess is allowed as a deduction in calculating the profits for the period of account in question, but

if so much of the unappropriated surplus at the end of that immediately preceding period of account as was required to meet the duty of fairness exceeds so much of the unappropriated surplus at the end of the period of account in question as is required to meet that duty, the excess is to be taken into account as a receipt of the period of account in question.

for periods of account ending before 14th March 1989 (and the first notional period of account, within the meaning of section 82 above as originally enacted) have been excluded, by virtue of section 433 of the Taxes Act 1988, as being reserved for policy holders or annuitants, and

have not before that date either been allocated to or expended on behalf of policy holders or annuitants or been treated as profits of an accounting period on ceasing to be so reserved.

an insurance company (“the company”) enters into a contract of reinsurance which is a relevant financial reinsurance contract, and

F117condition A is met.

some or all of the liabilities reinsured may cease to be reinsured (without the cedant having any right of recovery against the reinsurer), or

the cedant may become liable to pay premiums wholly or partly determined (directly or indirectly) by reference to any amount which the reinsurer becomes liable to pay to the cedant under the contract.

“the full liabilities” is the amount which would be brought into account for the period as liabilities but for the relevant financial reinsurance contract, and

“the reduced liabilities” is the amount of the liabilities actually so brought into account.

a company which is a non-profit company, or

the non-profit fund of a company which is not a non-profit company,

to the closing liabilities of the company for the first period of account which ends on or after 31st December 2006, and

to the opening liabilities of the company for the next period of account.

the relevant amount shall be reduced (but not below nil) by so much (if any) of the amount shown in paragraph 4(12) of Appendix 9.4 to the periodical return as is reflected in column 1 of line 51 of the Form 14 for that period of account relating to the non-profit fund in question; and

the references in subsection (3) to liabilities are references to liabilities relating to the non-profit fund in question.

investment income receivable before deduction of tax,

an increase in the value of non-linked assets,

an increase in the value of linked assets, F124...

other income; F125or

business transfers-in.

comprises notional income for the period of account (see subsections (2AA) and (2AB)),

represents an inter-fund transfer (see subsections (2AC) and (2AD)),

is exempted by section 444AC(2) of the Taxes Act 1988 (transfers of business), or

consists of interest paid under section 826 of the Taxes Act 1988 (interest on tax overpaid) in respect of a repayment or payment relating to an accounting period of the company ending before 1st July 1999;

it represents income which has not been received, and is not receivable, from another person, and

a corresponding notional expense of the same amount is brought into account in the period of account;

is not deductible in computing the profits of the company in respect of its life assurance business in accordance with the provisions of the Taxes Act 1988 applicable to Case I of Schedule D, but

had it represented an amount paid or payable to another person, would have been so deductible.

one or more inter-fund transfers (“transfers-in”) are made into a fund and one or more inter-fund transfers (“transfers-out”) are made out of the fund, and

subsection (2C) F131, (2D) or (2DA) below, or

section 444AD of the Taxes Act 1988 (transfers of business).

were brought into account for any period of account, but

were not taken into account as receipts of the period of account under subsection (2) above.

assets of the company’s long-term insurance fund are transferred by the company to another person (“the transferee”),

the transferee assumes, as a result of the transfer, a liability representing a debenture loan which, immediately before the transfer, was a liability of that fund, and

the liability does not, as a result of the transfer, become a liability of any long-term insurance fund of the transferee,

an insurance business transfer scheme, or

a scheme which would be such a scheme but for section 105(1)(b) of the Financial Services and Markets Act 2000 (which requires the business transferred to be carried on in an EEA State),

a transfer of business to the company, or

a demutualisation of the company not involving a transfer of business,

would fall to be taken into account as a receipt apart from this section,

is taken into account under subsection (2) above otherwise than by virtue of subsection (3) above, or

represents so much of the proceeds of the disposal of an asset of the long-term insurance fund as does not exceed its fair value or an asset acquired for at least its fair value which is added to that fund.

after the making of any reduction under subsection (6) of section 83AA below in relation to that period, F140...

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a transfer, under an insurance business transfer scheme, of business which consists of the effecting or carrying out of contracts of long-term insurance;

a qualifying overseas transfer, within the meaning of paragraph 4A of Schedule 19AC to the Taxes Act 1988; or

the making of a contract of reinsurance which, in whole or in part, constitutes or forms part of a total reinsurance by the reinsured, unless the reinsurer under the contract falls within section 439A of the Taxes Act 1988 (pure reinsurance).

under policies of a particular description issued in respect of insurances made in the course of carrying on life assurance business F148...; or

under contracts of a particular description so made.

the amount shown in line 51 of Form 14 of its periodical return in respect of the whole of its long-term business for any period of account (“the current period of account”), exceeds

the aggregate amount of the amounts shown in line 51 of Form 14 of its periodical return in respect of its with-profits funds (if any) for that period.

the appropriate line 51 amount of the company for the current period of account (“the current line 51 amount”), and

the aggregate amount of the appropriate line 51 amount of the company for the previous period of account (if any) and the amount of any transfer-in amount of the company for that period.

in the revenue account mentioned in section 83A(2)(a), or

if section 83A(4) is applicable, in the separate revenue account treated as prepared by virtue of that provision.

a transfer takes place in the following period of account, and

the company, as the transferee, is a party to an election under section 444AD of the Taxes Act 1988 (transfers of business: modification of section 83(2B)),

none of the liabilities of that business, or

none but an insignificant proportion of those liabilities,

is irrevocable, and

must be made by notice to an officer of the Board on or before the end of the period of 6 months beginning with the day on which that period of account ends.

in the case where no with-profits funds form part of its long-term business for that period, the amount shown in line 51 of Form 14 of its periodical return in respect of the whole of its long-term business for that period, and

in any other case, so much of that amount as exceeds the aggregate amount of the amounts shown in line 51 of Form 14 of its periodical return in respect of its with-profits funds for that period.

any assets (“the added assets”) become assets of its long-term insurance fund but do not become assets of any of its with-profits funds,

the consideration for the acquisition of the added assets does not comprise any assets which, immediately before the acquisition, were assets of its long-term insurance fund,

no amount is shown in respect of the added assets in any of lines 17 to 41 of Form 14 of its periodical return in respect of the whole of its long-term business for the period of account, and

no amount is brought into account for the period of account in consequence of the acquisition of the added assets.

the amount which would be obtained from an independent person purchasing them, or

if the assets are money, its amount.

a repayment in respect of a loan is made by the company in the period of account, and

the loan is one in relation to which the company has, for the purposes of step 2, an unrecognised capital amount for that or any other period of account.

a deposit is received by the company from a reinsurer or arises out of insurance operations of the company,

a debenture loan is made to the company, or

an amount is borrowed by the company from a credit institution,

one or more contingent loans have been made to the company at or before that time, and

amounts will or may at some later time become repayable by the company in respect of the contingent loan or contingent loans.

subsection (5) below applies if the company did not have unrepaid contingent loan liabilities at the end of the period of account immediately preceding the period of account in question, and

subsection (6) below applies if it did.

if the appropriate amount for the period of account in question exceeds the appropriate amount for the immediately preceding period of account, the excess is allowed as a deduction in calculating the profits for the period of account in question, but

if the appropriate amount for the immediately preceding period of account exceeds the appropriate amount for the period of account in question, the excess is to be taken into account as a receipt of the period of account in question.

any relevant net transfers to shareholders, F153...

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the period of account,

the period of account in which the relevant contingent loan was made to the company, and

any period of account falling between the periods of account mentioned in paragraphs (a) and (b) above,

if amounts will or may at some later time become repayable by the company in respect of only one contingent loan, that contingent loan, and

if amounts will or may at some later time become repayable by the company in respect of more than one contingent loan, whichever of those contingent loans was made to the company first.

an amount becomes repayable under a contingent loan made to the company, and

the amount repayable is brought into account as other expenses for the period of account,

have become repayable in respect of the contingent loan in any earlier period of account, and

have been allowed as a deduction in calculating the profits of the company for any such period.

in a case where the amount taken into account as a receipt of the company under section 83(2) above in relation to the contingent loan or loans in question is an amount brought into account in an account concerned wholly with non-participating business, are to its being brought into account in that account or in any other account concerned wholly with non-participating business, and

in a case where the amount so taken into account is an amount brought into account in an account concerned wholly or partly with participating business, are to its being brought into account in that account or in any other account concerned wholly or partly with participating business.

a transfer to another fund brought into account for a period of account as other expenditure in any account concerned wholly with non-participating business is brought into account as other income in an account concerned wholly or partly with participating business, or

a transfer to another fund brought into account for a period of account as other expenditure in any account concerned wholly or partly with participating business is brought into account as other income in an account concerned wholly with non-participating business,

an account is concerned wholly with non-participating business if it relates exclusively to policies or contracts under which the policy holders or annuitants are not eligible to participate in surplus, and

an account is concerned wholly or partly with participating business if it relates wholly or partly to other policies or contracts.

the aggregate of those amounts exceeds the loss which, after the making of any reduction under subsection (6) below but before any application of section 83(3) above in relation to that period, would have arisen to the company in that period in respect of its life assurance business, or

no such loss would have so arisen,

if the aggregate of the relevant amounts brought into account for that period exceeds the amount of any loss which, after the making of any reduction under subsection (6) below but before any application of section 83(3) above in relation to that period, would have arisen to the company in that period in respect of its life assurance business, the amount of the excess; or

if no such loss would have so arisen, the aggregate of the relevant amounts brought into account for that period.

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under this subsection, in the reduction of a loss arising to the company in an earlier period of account; or

under section 83AB below, in relation to a transfer of business from the company in that or any earlier period of account.

before any application of section 83(3) above in relation to that period, F179...

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there is a surplus for the period of account of the company for which that amount is brought into account,

at any time after the transfer of business or demutualisation, there is a transfer of business from the company (the “subsequent transfer”), and

ends with the day on which the subsequent transfer is effected; or

if the subsequent transfer is a transfer of business falling within section 83(6)(c) above and no accounting period of the company ends on that day, ends next after that day;

the first beginning at the beginning of the straddling period and ending on 31st December 1989; and

the second beginning on 1st January 1990 and ending at the end of the straddling period;

amendments relating to franked investment income, loss relief and group relief; and

amendments consequential on or supplemental to sections 82 and 83 above and sections 85 to 89 below.

paragraphs 2 and 6 shall be deemed to have come into force on 14th March1989; and

the remainder shall have effect with respect to accounting periods beginning on or after 1st January 1990 (including the 1990 component period).

which, if those profits were charged under Case I of Schedule D, would betaken into account in computing those profits; and

which would not be within the charge to tax (except under Case I of Schedule D) apart from this section;

any premium; F189...

any sum received by virtue of a claim under an insurance contract(including a re-insurance contract); or

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any sum which is not within the charge to tax (except under Case I of Schedule D) because of an exemption from taxF191; or

any payment received under the Financial Services Compensation Scheme to enable the company to meet its obligations to policy holders.

in the case of a repayment or refund of acquisition expenses, the acquisition expenses fell within section 86 below,

in the case of a reinsurance commission, the policy or contract reinsured under the arrangement in respect of which the commission is paid constitutes basic life assurance and general annuity business, and

in any other case, it is income which, if it were income from an asset, would by virtue of section 432A of the Taxes Act 1988 (apportionment of insurance companies' income) be referable to basic life assurance and general annuity business.

commissions (however described), other than commissions for persons who collect premiums from house to house,

any other expenses payable solely for the purpose of the acquisition of business,

so much of any other expenses payable partly for the purpose of the acquisition of business and partly for other purposes as are properly attributable to the acquisition of business,

the securing on or after 14th March 1989 of the payment of increased or additional premiums in respect of a policy of insurance issued in respect of an insurance already made (whether before, on or after that date) F199and

the securing, in an accounting period beginning on or after 1st January 1992, of the payment of increased or additional consideration in respect of an annuity contract already made (whether in an accounting period beginning before, or on or after, that date).

including the whole of those expenses at Step 1,

making any reduction in those expenses which is required at Step 2, and

deducting any amount of reinsurance commission or any repayment or refund (in whole or in part) that falls for the period to be charged to tax under section 85 above,

Effect is given to this subsection at Step 6 (which requires the deduction of six-sevenths of the adjusted amount of the acquisition expenses for the period).

a further fraction of the adjusted amount of those expenses is to be relieved under that section for each succeeding accounting period after the base period, until the whole of the adjusted amount has been relieved,

the fraction is one-seventh, except that for any accounting period of less than a year the fraction is to be proportionately reduced, and

the relief is given by including that fraction of the adjusted amount at paragraph (b) of Step 8,

the fraction of the adjusted amount of the acquisition expenses for the base period which would otherwise fall to be relieved in accordance with subsection (8) above, exceeds

the balance of that adjusted amount which has not been so relieved for earlier accounting periods,

shall have effect in relation to the 1989 component period without regard to the amendments made by subsections (2) to (4) above; and

shall have effect in relation to the 1990 component period as amended by those subsections.

the policy holders’ share of the relevant profits for any accounting period, or

where the business is mutual business, the whole of those profits,

amounts falling in respect of any non-trading deficits on the company’s loan relationships to be brought into account in that period in accordance with paragraph 4 of Schedule 11 to the Finance Act 1996, F215and

the basic deduction given by Step 8 in F216section 76(7) of the Taxes Act 1988.

income and chargeable gains referable F218(in accordance with section 432A of the Taxes Act 1988) to the company’s basic life assurance and general annuity business, F219... F220and

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profits of the company chargeable under Case VI of Schedule D under sections 436, 439B and 441 of the Taxes Act 1988 (pension business, life reinsurance business and overseas life assurance business).

any allowable losses so referable accruing to the company in the accounting period, and

so far as they have not been allowed as a deduction from chargeable gains in any previous accounting period, any allowable losses so referable previously accruing to the company.