What does section 357LI of the Corporation Tax Act 2010 do?

Section 357LI provides that a Lloyd's members' agent or managing agent based in Northern Ireland is automatically treated as an agent of independent status acting in the ordinary course of business, provided three conditions are met. This prevents a Lloyd's corporate member from being treated as having a Northern Ireland trading presence solely because its agent operates there.

What are the three conditions in section 357LI for independent agent treatment?

The three conditions are: (A) the company must be a corporate member of Lloyd's as defined in the Finance Act 1994, (B) the transaction must be part of the company's underwriting business at Lloyd's, and (C) the person carrying out the transaction must be acting in their capacity as members' agent or managing agent of the relevant syndicate.

Does a Lloyd's corporate member have a Northern Ireland trading presence if its managing agent is based there?

Not if all three conditions of section 357LI are satisfied. Where the corporate member's managing agent in Northern Ireland conducts underwriting transactions in its proper capacity, the agent is treated as independent. Consequently, the corporate member is not regarded as trading in Northern Ireland merely because the agent operates from there.

Why does section 357LI treat Lloyd's agents differently from other agents?

The Lloyd's insurance market requires corporate members to operate through members' agents and managing agents rather than transacting business directly. Section 357LI recognises this unique market structure by ensuring that the mandatory use of agents does not inadvertently create a Northern Ireland taxable trading presence for corporate members.

Corporation Tax Act 2010 section 357LI

Lloyd's agents

Section 357LI sets out when a Lloyd's members' agent or managing agent based in Northern Ireland is treated as an independent agent for the purposes of the Northern Ireland corporation tax rules.

Where a person in Northern Ireland acts as a members' agent or managing agent at Lloyd's on behalf of a company, they may be treated as an agent of independent status.
This treatment applies only if the company is a corporate member of Lloyd's (Condition A), the transaction is part of the company's underwriting business (Condition B), and the person acts in their capacity as members' agent or managing agent of the relevant syndicate (Condition C).
The definitions of "corporate member", "members' agent" and "managing agent" are taken from the Finance Act 1994.
If all three conditions are met, the agent is regarded as acting independently in the ordinary course of business, which is relevant to determining whether the company has a Northern Ireland trading presence.

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