Taxation (International and Other Provisions) Act 2010 section 97A

Commercial allocation of relevant income to different categories of long-term business

Section 97A sets out how insurance companies carrying on more than one category of long-term business must allocate their relevant income between those categories for the purposes of claiming double taxation credit relief.

• The amount of relevant income treated as belonging to a particular category of long-term business must be determined using an acceptable commercial method chosen by the company for the period of account in question.
• A method qualifies as an "acceptable commercial method" if it can reasonably be regarded as a fair way of working out how much of any income or gain arising in the period relates to a particular category of long-term business.
• The Treasury has the power to make regulations specifying when a method does or does not qualify as acceptable, and may prescribe a particular method as the only acceptable one in certain cases.
• Unless Treasury regulations say otherwise, the allocation method used must be consistent with the method adopted for apportionment purposes under section 98 or section 115 of the Finance Act 2012 for the same period.