CTM40525 - Particular bodies: industrial and provident societies: carrying on trade - collective assurances

Many industrial and provident societies have schemes for payment of a benefit on the death of a member (or a member's spouse) proportionate to the amount of the member's transactions with the society. Where such benefits are provided by means of an insurance policy, the premiums paid (less any rebates received) should be allowed as a deduction in computing the trading profits. Where the benefits are provided out of the society's own fund, the actual payments of the fund should be allowed. No objection is to be taken to the allowance of these amounts on the ground that they are not calculated by reference to transactions with the society for the accounting period.