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HMRC internal manual

Lloyd's Manual

From
HM Revenue & Customs
Updated
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Names: an example of the elements of the taxable profits

The table below shows the constituent elements of the taxable profits of two Names for 2001-02.

    Name A Name B
       
  Payment date £ £
AGGREGATE SYNDICATE RESULTS      
1998 account syndicates and run-off syndicates to 31 Dec 2000 May 01 50,000 (40,000)
STOP LOSS RECOVERIES      
In respect of 1998 account losses or 2000 run-off years of earlier unclosed accounts. Jan 02   20,000
SRF TRANSFER/ WITHDRAWAL      
From 1998 account commercial profits      
To meet 1998 account cash calls Oct 01
Sep 01 (20,000) 20,000    
  ANCILLARY TRUST FUND INCOME      
  Gilt interest Jun 01 5,000 5,000
    Dec 01 5,000 5,000
  OTHER LLOYD’S RELATED INCOME      
  Final instalment of damages from action for negligence in relation to the 1991 account Feb 01 2,000 2,000
  LLOYD’S RELATED EXPENSES      
  Legal expenses relating to above claim for damages Jun 01 (1,200) (1,200)
  Stop loss insurance policy premium for the 2001 account Jan 01 (2,000) (2,000)
  CASE I RESULT FOR 2001-02   38,800 8,800

Note: For Name B, the stop loss recovery of £20,000 follows a cash call for £40,000. For the purposes of this example, it is assumed that Name B has a policy which pays out any losses above £20,000. The cash call of £20,000 will lead to £20,000 coming out of the SRF, assuming that sufficient funds are available.