Income Tax (Trading and Other Income) Act 2005 section 515

Requirement for annual calculations in relation to personal portfolio bonds

Section 515 requires an annual gain calculation to be carried out at the end of each insurance year for any policy or contract that is a personal portfolio bond at that time, except in the final insurance year.

• If a policy or contract is a personal portfolio bond at the end of an insurance year (other than the final insurance year), a gain calculation must be performed
• The calculation follows the method set out in section 522 and is made as at the end of the relevant insurance year
• The purpose of the calculation is to establish whether a gain has arisen on the policy or contract for that year and, if so, the amount of that gain
• This annual calculation is in addition to any other calculations required under the same chapter, so any gain arising is added to gains from other chargeable events in the same tax year