The balance of premiums, claims, expenses and provisions (the
underwriting result) as disclosed in the return to the Financial
Services Authority, clearly falls within both Section 11 and
Article 7, allowing an FSA return for overseas insurers to be used
for tax purposes.
In the case of an EEA insurer making regulatory returns to
its Home State figures will have to be taken from whatever accounts
and information are prepared by the company and submitted with its
tax return. Details supplied by the company to its Home State
regulator as UK branch business in its Article 44.2 Third Directive
return is a starting point if nothing else is available.
In the case of a non-EEA insurer, the FSA return will be a
return of UK branch business, unless the insurer is a UK deposit
insurer (
GIM10090), in which case the return will
be of EEA business.
explains that Article 7(3) of the OECD Model allows expenses incurred for the purpose of the permanent establishment, including executive and general administrative expenses, whether incurred in the State where the permanent establishment is situated or elsewhere. This provision does no more than re-affirm UK domestic law, and is explicitly reflected at ICTA88/S11AA (4).
+ sets out special rules for EEA insurers who do not make a UK regulatory return. Non-EEA insurers follow the same provisions as apply to UK insurers.
