Finance Act 2012

Period over which deemed receipts or expenses arise U.K.

11 (1) A receipt or expense within paragraph 9 or 10 is to be treated as arising over the period of 10 years beginning with 1 January 2013. U.K.

(2) The amount of the receipt or expense apportioned to (and treated as arising in) any accounting period falling wholly or partly in that 10-year period is to be determined in proportion to the number of days of the accounting period falling within that 10-year period.

(3) This paragraph does not apply to a receipt which consists of a relevant court-protected item within the meaning of paragraph 12.

(4) This paragraph is subject to paragraphs 13 to 15 (transfers and cessation of business etc).

12 (1) For the purposes of this paragraph a “relevant court-protected item” means a relevant computational item that relates to an excess of assets over liabilities held in a non-profit fund in respect of which an order made by a court is in force preventing the distribution of the excess (in any circumstances whatever) before the end of a period specified in the order. U.K.

(2) A receipt within paragraph 9 or 10 consisting of a relevant court-protected item is to be treated as arising over the period of 10 years beginning with the relevant day.

(3) The relevant day is whichever of the following days occurs first—

(a) the day on which the court order ceases to be in force, or

(b) 1 January 2015.

(4) The amount of the receipt apportioned to (and treated as arising in) any accounting period falling wholly or partly in that 10-year period is to be determined in proportion to the number of days of the accounting period falling within that 10-year period.

(5) This paragraph is subject to paragraphs 13 to 15 (transfers and cessation of business etc).

13 (1) This paragraph applies if— U.K.

(a) under an insurance business transfer scheme, there is a transfer from one insurance company to another of basic life assurance and general annuity business (or any part of that business) or non-BLAGAB long-term business (or any part of that business),

(b) the transfer is a relevant intra-group transfer, and

(c) the transfer occurs at a time when the full amount of the receipts or expenses within paragraph 9 or 10 of the business the whole or part of which is transferred has not been treated as arising.

(2) A transfer is a “relevant intra-group transfer” for the purposes of this paragraph if—

(a) the transferor and the transferee are members of the same group of companies when the transfer occurs (as determined in accordance with section 170(2) to (11) of TCGA 1992), and

(b) the transferee is within the charge to corporation tax in relation to the transfer.

(3) The receipts or expenses are to continue to be dealt with in accordance with the provisions of this Schedule, but are treated as arising to the transferee over so much of the 10-year period in question as falls on or after the date on which the transfer takes place.

(4) If only part of a business is transferred—

(a) the appropriate proportion of the receipts or expenses is treated as arising to the transferee over so much of the 10-year period in question as falls on or after the date on which the transfer takes place, and

(b) the remainder of the receipts or expenses is treated as arising to the transferor over so much of that period.

(5) The appropriate proportion of the receipts or expenses of a business is equal to the proportion which the value of the liabilities relating to the part of the business transferred bears to the total value of the liabilities of the whole of the business.

(6) For the purposes of this paragraph and paragraphs 11 and 12 the accounting periods of the transferor and the transferee in which the transfer takes place are deemed to end immediately before the transfer takes place.

14 (1) This paragraph applies if— U.K.

(a) under an insurance business transfer scheme, there is a transfer from one insurance company to another of basic life assurance and general annuity business (or any part of that business) or non-BLAGAB long-term business (or any part of that business),

(b) the transfer is not a relevant intra-group transfer for the purposes of paragraph 13, and

(c) the transfer occurs at a time when the full amount of the deemed receipts or expenses of the relevant business has not been treated as arising to the transferor.

(2) The remaining amount of the deemed receipts or expenses of the relevant business is to be treated as arising to the transferor in the accounting period in which the transfer takes place.

(3) In this paragraph references to the deemed receipts or expenses of the relevant business—

(a) are references to the receipts or expenses within paragraph 9 or 10 of the business the whole or part of which is transferred, but

(b) do not include references to so much of those receipts or expenses as fall (or have fallen) to be treated as arising to a company other than the company which is the transferor for the purposes of this paragraph.

15 (1) This paragraph applies if— U.K.

(a) an insurance company ceases at any time to carry on basic life assurance and general annuity business or non-BLAGAB long-term business otherwise than as a result of a transfer under an insurance business transfer scheme, and

(b) at that time the full amount of the deemed receipts or expenses of the business concerned has not been treated as arising to the company.

(2) The remaining amount of the deemed receipts or expenses of the business concerned is to be treated as arising to the company in the accounting period in which it ceases to carry on the business concerned.

(3) For the purposes of this paragraph an insurance company is to be regarded as ceasing to carry on a business at any time if, at that time, it ceases to be within the charge to corporation tax in relation to the business.

(4) In this paragraph references to the deemed receipts of the business concerned—

(a) are references to the receipts or expenses within paragraph 9 or 10 of the business concerned, but

(b) do not include references to so much of those receipts or expenses as fall (or have fallen) to be treated as arising to a company other than the company concerned.