Schedule 7 - Insurance companies etc
Finance Bill
9:30 am
Ms Ruth Kelly (Financial Secretary, HM Treasury; Bolton West, Labour)
I will be delighted to speak at greater volume.
It now turns out that other liabilities may also be left behind. Amendment No. 86 therefore adds additional liabilities to the list.
Amendment No. 87 ensures that another related provision in the Bill works properly. The provision was designed to prevent companies from exploiting the relaxation of the retained assets rule, but it could work harshly where a company's genuine attempts to
estimate its liabilities to policyholders turned out to be overcautious. As long as the retained assets that are not needed to pay claims also end up with policyholders, no additional charge to tax will arise.
Amendment No. 88 makes some minor technical changes. It adds a few more examples of life assurance tax provisions where it has become desirable to clarify what is meant by something being referable to a particular category of life assurance business. The amendment makes it clear that referability is based on the rules in section 432A of the Income and Corporation Taxes Act 1988. Those are also the rules for the provisions that were originally included in paragraph 9 of schedule 7. The additional provisions were, however, accidentally left out. I therefore commend the amendments to the Committee.