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HMRC internal manual

Insurance Policyholder Taxation Manual

From
HM Revenue & Customs
Updated
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Personal portfolio bonds: meaning: index selection

A policy or contract is not a personal portfolio bond merely because its terms permit the selection of an index as described at IPTM3610 if that index

  • falls within the following categories - index categories 

    • retail price index
    • any general index which is similar to the retail price index and is published by the government of any foreign state or its agent
    • any published index of prices of shares listed on a recognised stock exchange,

and

  • meets either the general or class index selection conditions

general condition: an index meets this condition if, at the time when it may be selected, the opportunity to select the same index is available to

* all policyholders of the insurer, or
* persons acting on behalf of the policyholders

class condition: an index meets this condition if, at the time when it may be selected, the opportunity to select the same index is available to

* a particular class or classes of policyholders of the insurer, or
* persons acting on behalf of the members of that class or those classes.

For this purpose a group of policyholders is a class if

  • neither membership of the class nor the opportunity is limited to connected persons
  • the question whether a policyholder is a member of the class, or has the opportunity, is determined solely by the insurer
  • the opportunity is clearly identified in marketing or other promotional material published by the insurer to members of the public, or members of the public who are intending investors, as available generally to any person falling within its terms.

More details at IPTM7785.

Further reference and feedback IPTM1013