- This topic is empty.
-
Posts
-
Can someone outline how insurance premium tax (IPT) works, including when it is chargeable, how it is calculated, who is liable to pay it and how it is administered by HMRC? i cant seem to find much online information on this.
Insurance Premium Tax
Insurance Premium Tax (IPT) is a government-introduced tax on insurance policies including car, home, travel and pet which every insurance provider has to charge. IPT is charged Only if there is a premium under a taxable insurance contract.
A taxable insurance contract is one with a: 1. premium 2. Insured indemnified against a loss 3. Insured has an insurable interest. [Prudential case]
The definition of Premium payment includes payment for risks, commission, admin, taxes, interest etc.
IPT may not be charged if the contract is a separate insurance contract ie separately disclosed & client has a choice etc.
Once you decide that IPT is chargeable, you need to figure out the rate: std, higher, exempt & calculate the IPT chargeable.
- You must be logged in to reply to this topic.