IPT on the rise again

Budget Case

Insurance Premium Tax is on the rise again. In the Chancellors recent Budget, it was confirmed that IPT will increase by 0.5%, rising to 10% from 1 October 2016. LV= will be follow the Special Accounting Measures from the 1 October until the 1 February 2017.

The project team are working with our internal teams, the software houses and partner brokers to ensure we are well prepared for this change.

If you have any questions about the changes please speak to David Simpkin (Commercial Lines) – 0207 634 4446 or Michael Warner (Personal Lines) – 01277 721 714.

Here are the details for the special accounting rules:

Policy start date and renewals

• Policies with a start or renewal date of 1 October 2016 will be subject to the new standard rate of 10%

• Policies with a start or renewal date before 1 October will be subject to the current rate of 9.5% as long as the premium is brought to account before1 February 2017, for premiums brought to account on or after the 1 February 2017 will be subject to the new standard rate of 10% regardless of rate received from policyholder or the start/renewal date of the policy contract

Mid Term Adjustments

• Any mid-term adjustments occurring before 1 October will be subject to the current rate of 9.5%

• Any mid-term adjustments occurring on or after 1 October will be subject to the current rate of 9.5% as long as the original policy was incepted prior to 1 October and any additional premiums relating to the MTA are paid prior to 1 February 2017.

• Any mid-term adjustments occurring on or after 1 October where the original policy has a start or renewal date on or after 1 October will be subject to the new standard rate of 10%

 



Categories: Commercial Lines, Personal Lines

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