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HMRC internal manual

Insurance Policyholder Taxation Manual

Overseas insurers: arrangements for the insurer to carry out itself the full duties of a tax representative

Arrangement with HMRC for an insurer to provide information directly without appointing a tax representative

Instead of appointing a tax representative to provide full information under ICTA88/S552 to policyholders and HMRC, an insurer may enter a formal arrangement with HMRC to provide the information directly, under regulation 11 of the Tax Representative Regulations.

Under such an arrangement there are no special rules for policies and contracts made before 6 April 2000, in contrast to the circumstances where an insurer is released under regulation 12(1)(c) from the requirement to have a tax representative, as described at IPTM9140.

An insurer may wish to set up these arrangements if it sells insurance on a services basis in the UK and also has a branch in the UK. It might then enter into an agreement with HMRC whereby all the information about the services business is supplied to policyholders and HMRC by the UK branch.

Procedure for setting up and monitoring the arrangements

If an overseas insurer wants to enter into an arrangement to provide information under ICTA88/S552 directly it should write to HMRC at the address given in IPTM9010 stating how it will comply. Provided HMRC accepts the arrangements, the insurer will not need to have a tax representative so long as the arrangement lasts.

HMRC will monitor the effectiveness of the arrangements and may withdraw from them if it has reason to believe that the insurer has failed to comply with their terms. However, HMRC will give the insurer the opportunity to explain any discrepancies or omissions before taking steps to withdraw from the arrangements. It would not withdraw if it was satisfied that any failures were not deliberate and action had been taken to prevent similar failures happening in future.

If HMRC withdraws from the arrangements it will appoint a tax representative unless the insurer does so as described in IPTM9050 onwards.

An overseas insurer has the right to ask HMRC to review the decision and to appeal against a decision by HMRC to withdraw from arrangements under regulation 11 to provide information directly.

Further reference and feedback IPTM1013