Corporation Tax Act 2009 section 130A

Insurers in financial difficulties: write-down orders

Section 130A ensures that receipts and expenses arising from court orders that write down an insurer's liabilities are excluded from trading profit calculations for corporation tax purposes.

• Where an insurer is in financial difficulty, a court may make a write-down order under the Financial Services and Markets Act 2000 to reduce the insurer's liabilities.
• Any receipt or expense that arises because of the operation of such a write-down order is not brought into account when calculating trading profits.
• Similarly, any receipt or expense arising when a write-down order ceases to have effect is also excluded from trading profit calculations.
• This provision was introduced by Finance (No. 2) Act 2023 and applies specifically to orders made under section 377A of the Financial Services and Markets Act 2000.