Income Tax (Trading and Other Income) Act 2005 section 122

The first selection condition

Section 122 sets out the first selection condition that a life insurance policy or capital redemption contract must meet, based on how its benefits have been determined since 6 April 1994.

• The first selection condition applies where benefits have never been linked to non-permitted indices or non-permitted property since 6 April 1994.
• Throughout the entire period from 6 April 1994 to the present, it must have been impossible to calculate any part of the benefits by reference to a non-permitted index.
• Similarly, it must have been impossible throughout that period to determine any part of the benefits by reference to property that is not classified as permitted property.
• What counts as a permitted index and permitted property is defined separately in paragraphs 126 and 127 respectively.