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HMRC internal manual

General Insurance Manual

Equalisation reserves: credit business: de minimis limits

There are de minimis limits for credit insurance business. An insurer does not have to maintain a reserve in any financial year (see GIM7210) in respect of its credit insurance business if at the end of the year annualised net written premiums from its credit insurance business are less than 4 per cent of the annualised net written premiums in that financial year from all its general insurance business and less than €2,500,000 in total.

Reserves accumulated under the old supervisory rules are taken into account by the regulator in determining whether the regulatory requirement to maintain reserves has been met, but tax relief is not available on such reserves and no account is taken of these accumulated reserves when making tax relief computations for subsequent years.