Income Tax (Trading and Other Income) Act 2005 section 534

Regulations providing for relief in other cases where foreign tax chargeable

Section 534 gives HMRC the power to make regulations extending the tax credit relief available on gains from life insurance policies and contracts to cases involving insurers based outside the European Economic Area, where foreign tax is chargeable.

• Where gains from a life insurance policy or contract would normally not qualify for the deemed tax credit under section 530 (because of exclusions in section 531 or transitional rules), HMRC may step in if foreign tax applies
• HMRC can make regulations to restore the section 530 tax credit for these gains where the insurer is based outside the EEA but is subject to tax in its home territory, provided a claim is made
• This regulation-making power covers situations not already dealt with by section 532, which provides relief specifically for policies with EEA-based insurers
• The regulations can apply retrospectively — the conditions they specify can relate to a time before the regulations were made, as well as to later periods