Corporation Tax Act 2009 section 18Q

Insurance companies

Section 18Q excludes certain insurance business profits and losses from the foreign permanent establishment exemption regime and disapplies a specific historical election relating to general insurance technical provisions.

• Profits or losses from basic life assurance and general annuity business are excluded from the relevant profits amount and relevant losses amount for the purposes of the exemption regime.
• Because these amounts are excluded, they cannot benefit from the foreign permanent establishment exemption and remain subject to corporation tax in the normal way.
• Any election previously made under section 107(4) of Finance Act 2000 concerning adjustments for technical provisions in general insurance must be ignored for the purposes of this regime.
• Section 107 of Finance Act 2000 was repealed by Finance Act 2007, so the practical impact of ignoring that election is limited to calculating a company's opening negative amount.