The chargeable event gain rules no longer apply to companies from the start of the first accounting period of the company to begin on or after 1 April 2008 – the ‘company’s start date’ – and instead the loan relationships rules apply – IPTM3900 onwards and IPTM7107.
In contrast to the position for individuals, where the person
chargeable on any gains under a qualifying policy is a company,
whether the policy is ‘time-served’ is generally of no
significance. The full range of chargeable events listed in I
PTM3400 may arise on the policy
irrespective of how long it has run, subject to the following
exception.
The exception is where there is a part surrender or
assignment event arising when a transaction-related calculation
shows a gain. The position is then the same as for individuals, as
described in
IPTM7310: the event will not be a
chargeable event if the insurance year in which it occurs ends on
or after the date on which the policy becomes
‘time-served’. This exception is an unintended anomaly
arising from the changes to the chargeable event rules introduced
in FA2001.
Where the policyholder is a company, the insurer may if it
wishes assume that the company is also the chargeable person for
the purposes of determining whether a chargeable event should be
reported on a qualifying policy.
| Further reference and feedback | IPTM1013 |
