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HMRC internal manual

Insurance Policyholder Taxation Manual

From
HM Revenue & Customs
Updated
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Personal portfolio bonds: meaning: bonds made on or after 17 March 1998

The following definition applies to personal portfolio bonds made on or after 17 March 1998. The definition for bonds issued before that date, and not varied on or after 16 July 1988, is given at IPTM3620.

A personal portfolio bond (PPB) is a life insurance policy, life annuity contract, or capital redemption policy under whose terms

  • some or all of the benefits are determined by reference to

    • fluctuations in, or in an index of, the value of property of any description, or
    • the value of, or the income of, property of any description

and

  • the terms of the policy or contract permit the selection of the index, or some or all of the property, by

    • the holder of the policy or contract
    • a person connected with the holder
    • the holder and a connected person acting together
    • a person acting on behalf of the holder
    • a person acting on behalf of a person connected with the holder
    • a person acting on behalf of the holder and a person connected with the holder acting together

except where the terms of the policy or contract only permit the selection of certain narrowly-defined property or indices, listed in IPTM3630andIPTM3640, to determine the benefits.  

For these purposes

  • it does not matter whether the index or property is specified in the policy or contract
  • ‘holder’ includes any holder if there are two or more.
Further reference and feedback IPTM1013