Corporation tax4
1
No liability to corporation tax arises in respect of the profits arising from the activity of insurance risk transformation carried out by a qualifying transformer vehicle.
2
For the purposes of paragraph (1), the following are not treated as an activity of insurance risk transformation—
a
administrative or management activities, or
b
subject to paragraph (3), holding investments in excess of the minimum amount reasonably required to satisfy the fully funded requirement in relation to the company or, in the case of a protected cell company, the cell.
3
Paragraph (2)(b) does not apply in relation to investments which were reasonably required to satisfy the minimum fully funded requirement in relation to a risk assumed under a contract of insurance until the expiration of 90 days from the date on which all liabilities under that contract have been satisfied.
4
For the purposes of this regulation, “the fully funded requirement” is the requirement imposed by Articles 319 and 326 of the Commission Delegated Regulation (EU) 2015/35 of 10 October 2014 supplementing Directive 2009/138/EC of the European Parliament and of the Council on the taking-up and pursuit of the business of Insurance and Reinsurance (Solvency II), or the equivalent requirement set out in rules made by the Prudential Regulation Authority7.