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HMRC internal manual

Insurance Premium Tax

Insurance premium tax: Accounting for Insurance Premium Tax: The special accounting scheme: Tax points for additional premiums (APs)

The tax point for APs under the special accounting scheme is the date of entry into the insurer’s records (even if the insurer is using the date as at which a premium is due to him - referred to as the “legal tax point” for other premiums). The relevant law is Regulation 24(2) and (3). Regulation 24(3) says that, in respect of additional premiums, where

… the insurer makes an entry in his accounts showing the excess (the additional premium) as due it shall be treated as received on the date he (the insurer) makes that entry in his accounts

We expect insurers to comply with the guidelines relating to undue delay (see IPT07645) for the creation of tax points when enteringAPs.

Example 10 - insurer receives an additional premium in relation to a new risk

  • Additional premium received on 1 June.
  • Entered in insurer’s records on 3 June.
  • Tax point for AP: 3 June.