global insurance management

Tax changes effective 4th January 2011


Oct 13 2010

Relevance: All regulated firms.

Action Required: Review and amend any standard documentation specifying the rate of IPT or VAT in advance of the tax changes scheduled for the beginning of next year.

Background

The budget, produced by the Coalition Government shortly after its election, made changes to IPT and VAT rates.

Both changes are effective from 4 January 2011.

We are conscious that many standard letters used by firms make reference to the fact that the premium includes 5% IPT. As this will be rising to 6%, any standard letters with such a reference in them need to be changed.

Equally, products subject to an IPT rate of 17.5% will, from 4 January, be subject to a rate of 20%.

Although unlikely to affect many firms, the VAT rate is also scheduled to increase on 4 January to 20%.
 

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