Finance Act 1994

Life assurance business: Case I of Schedule D

2 (1) Subject to sub-paragraph (2) below, sub-paragraphs (3) and (4) below apply where—

(a) a qualifying contract was at any time in an accounting period of an insurance company held by the company for the purposes of any life assurance business carried on by it, and

(b) the profits of the company in respect of that business are, for the purposes of the Tax Acts, computed in accordance with the provisions of the Taxes Act 1988 applicable to Case I of Schedule D.

(2) Where the qualifying contract was held partly for the purposes of the life assurance business and partly for other purposes—

(a) amounts A and B for the period shall be apportioned on a just and reasonable basis, and

(b) any reference in sub-paragraph (3) or (4) below to either of those amounts shall be construed as a reference to so much of it as is referable to the life assurance business.

(3) Notwithstanding anything in sections 159 and 160 of this Act, amount A for the period shall not—

(a) under or by virtue of this Chapter be chargeable to corporation tax as profits of the company, or

(b) be taken into account as a receipt in computing for the purposes of this Chapter the profits or losses of the company.

(4) Notwithstanding anything in those sections, amount B for the period shall not—

(a) be allowable as a deduction in computing for the purposes of this Chapter the profits or losses of the company, or

(b) under or by virtue of this Chapter be allowable as a deduction in computing any other income or profits or gains or losses of the company for the purposes of the Tax Acts.

(5) Subsection (5)(a) of section 173 of this Act applies for the purposes of this paragraph as it applies for the purposes of that section.