Income Tax (Trading and Other Income) Act 2005 section 85

Gains from contracts for life insurance etc: foreign policies of life insurance

Section 85 modifies how certain tax rules apply to foreign life insurance policies where the issuing company was subject to UK corporation tax on its insurance business income.

• The paragraph applies to foreign life insurance policies where the issuing company's income was charged to corporation tax under the old ICTA rules for an accounting period ending on or after the policy was issued
• Such a policy can be treated as a qualifying policy for any part of the chargeable period when it would otherwise have qualified but for the foreign policy exclusion, provided certain conditions from the old Schedule 15 to ICTA were met
• For the purposes of relief available in respect of policies with European Economic Area insurers, the policy period is shortened by excluding times when the Schedule 15 conditions were satisfied
• The chargeable period runs from the date the policy was issued until the last day of the final accounting period for which the issuing company was liable to corporation tax on its insurance business income