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HMRC internal manual

Insurance Policyholder Taxation Manual

HM Revenue & Customs
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Certificate for policyholder: meaning of ‘appropriate policyholder’

Events except part assignments

On all chargeable events other than part assignments, the ‘appropriatepolicyholder’ is the policyholder immediately before the happening of the chargeableevent. The date on which a chargeable event occurs is covered in the later sections ontypes of chargeable events.

Part assignments

Where the event is an assignment of part of or a share in the rights conferred by thepolicy or contract, the appropriate policyholder is any person who is both apolicyholder immediately before the assignment and an assignor. This isto ensure as far as possible that the chargeable event certificate is only sent to theperson or persons who is chargeable to tax on the gain on the part assignment, namely theassignors, and not to the other policyholders. There are examples at IPTM7630 and IPTM7640 of calculationson part assignments and the person to whom the certificate should be sent.

In the rare case where the insurer knows that there has been a part assignment giving riseto a chargeable event but none of the policyholders is an assignor because only beneficialownership has changed, not legal ownership, the insurer should report the gain to thepolicyholder.

Deceased policyholder

Where the policy has come to an end due to the death of the policyholder, theappropriate policyholder is the deceased person.

However, there is the potential for distress to be caused if an insurer issues achargeable event certificate addressed directly to the deceased in accordance with thelaw. To avoid this, HMRC accepts that the insurer will also be in full compliance of thereporting requirements if it addresses the certificate

  • to whoever is dealing with the estate of the deceased, for instance the personal representatives or a solicitor if the insurer has that information, or
  • to ‘Personal Representatives for’ the deceased policyholder at the last known address for the deceased if the insurer does not know the name and address of the person dealing with the estate.
Further reference and feedback IPTM1013