IPT06850 - Maintaining the IPT Register: registration of taxable intermediaries: apportionment and de minimis
Section 52A(4) of the Finance Act 1994, inserted by the Finance Act 1997, states that, for the purposes of taxable intermediaries and their fees, a contract is a higher rate contract if:
(a) it is a taxable insurance contract; and
(b) the whole or any part of a premium received under the contract by the insurer is ....liable to tax at the higher rate.
Thus any fee which relates to a contract liable to IPT at the standard and higher rate, and which meets the conditions set out in paragraph IPT06840, will be liable to IPT at 20% (or 17.5% if the tax point falls before the 4 January 2011) in its entirety. There is no scope for apportionment on the grounds that the fee relates to a ‘mixed’ contract and there are no de minimis provisions.