Off Shore Life Assurance Policies Flashcards
Where are off shore policies established
In countries with low taxes such as Luxembourg, Republic of Ireland, Isle of Man etc.
What is a benefit for having an offshore life policy
The fund has gross roll up in a low tax area and would have long term value to hr and at tax payers
Are offshore policies qualifying?
No they are not if issues after 17 November 1983
How are off shore policies charged on their gain
Done as income tax of the holder at their marginal rate.
No allowances allowed against it
Top slicing allowed but reduced by the number of years the person was not a res in the uk
Do off shore policies have withholding tax?
Yes they do if they have any payments from investments that are not from interests
How much money does a person need to have a tax representative
If the holder has 1 mill or more they will need it.
The reps job is to provide info to hmrc
Life office must appoint this and if they don’t hmrc will
What are ppb and how does hmrc tax it
Ppb is a personal portfolio bond that allows the investor to choose the investments
Hmrc have a tax of 15% on it irrespective if the fund yields this or not
No topslicing relief on chargeable gains
What is an olab
This is overseas life assurance business
Written with non uk res policy holders
Life office must get a certificate for it to be olab
How is an olab taxed
Taxed only on the profit itnmakes from writing the business
These funds grow faster than ordinary Uk funds
If a British citizen holds an olab what must the certificate state
The holder was not res in the uk at time of issue
Country of res
The holder will notify the company if they become res in the uk or if the policy becomes subject to a trust
When were olab qualifying and not
Not qualifying if issues after the 17 March 1998
Qualifying before that on the provision that any variation to increase the benefit or extend the term will make them non qualifying
