IPTM7120 - Certificate for policyholder: information to be provided: position following ITTOIA05

There is no prescribed form of certificate which insurers need to provide to policyholders after a chargeable event has arisen, although it must contain the information required by ICTA88/S552(5).

Interaction of section 552 with ITTOIA05 and ICTA88

ICTA88/S552 has been amended to take into account the rewrite of the chargeable event rules for income tax purposes in ITTOIA05. Although the structure and wording in ITTOIA05 are different from that in ICTA88, the rules governing what is a chargeable event and how any gain is calculated are fundamentally the same. The reporting requirements in section 552 also remain fundamentally the same. Although they were modified to include references to chargeable events in both ITTOIA05 and ICTA88, an insurer should only report information about an event and gain once on a single certificate for each policyholder and to HMRC, where this is required.

Following ITTOIA05, the rules in ICTA88 were retained, in slightly modified form, to apply where a company is the person liable on any gains. However, the chargeable event gain rules in ICTA88 no longer apply from the start of a company’s first accounting period to begin on or after 1 April 2008 and instead companies are taxed under the loan relationships rules – IPTM3900 onwards. References to the ICTA rules in ICTA88/S552 are also removed.