Claims Equalisation Reserves for Lloyd's members - Mazars - United Kingdom
Claims Equalisation Reserves for Lloyd's members
The Finance Act 2009 provided for regulations to allow members of the Lloyd’s insurance market to claim tax relief broadly equivalent to that of other general insurers who are required to maintain claims equalisation reserves.
The regulations have now been published and will come into force on 1 September 2009, in respect of declaration years 2008 onwards.
There is therefore an element of beneficial retrospection relevant to the corporation tax returns of Lloyd’s members being prepared this year.
The relief is available to both corporate and partnership members.
HMRC have confirmed the interpretation of the legislation to the effect that the member does not actually have to provide for the equalisation reserves in its accounts, on the basis that the members have already committed capital as protection against volatility under the Funds at Lloyd's Enhanced Capital Requirement mechanism.
The deduction will therefore operate as a tax adjustment in the tax computations from 2008 onwards, the basis for the deduction in 2008 being the amount of equalisation reserves which the Lloyd's members would have had to account for on business underwritten in 2005 if they had carried on the business outside Lloyd's.
Members should therefore now review the categories of business that they insure to determine the amounts which they will be able to claim as a deduction under the above principles.
National contacts
Contact us
- Copyright 2012 - Mazars - United Kingdom
- RSS
- Site map
- Legal and privacy
- Accessibility
- Copyright 2012 - Mazars - United Kingdom
