|
| |
|
(ii) | the total amount of the premiums payable under |
| |
the policy in any relevant period is or could be |
| |
| |
| |
(c) | the assignment on or after 6 April 2013 of any rights, or any |
| 5 |
share in any rights, under a policy where the assignment |
| |
falls within paragraph B2(3)(c) to (g) below; |
| |
(d) | a deceased beneficiary event on or after 6 April 2013; |
| |
(e) | the conditions in paragraph 24(3) below being fulfilled for |
| |
the first time in respect of a new non-resident policy |
| 10 |
| |
(i) | the conditions are fulfilled for the first time on or |
| |
| |
(ii) | but for the conditions being fulfilled, the policy |
| |
could not be a qualifying policy because of |
| 15 |
| |
(4) | An event does not fall within sub-paragraph (3) if— |
| |
(a) | the policy to which the event relates is— |
| |
| |
(ii) | a restricted relief qualifying policy, or |
| 20 |
(iii) | a pure protection policy, |
| |
(b) | the event is the issue of a policy which is a new policy in |
| |
relation to an earlier policy where— |
| |
(i) | the new policy is issued in substitution for the |
| |
earlier policy (and not on its maturity), and |
| 25 |
(ii) | the life assured under the new policy is different to |
| |
the life assured under the earlier policy but that is |
| |
the only difference to what the position would |
| |
have been had the earlier policy continued to run, |
| |
(c) | paragraph 20ZA below applies to a policy and the event is |
| 30 |
the reinstatement or replacement of the policy as |
| |
mentioned in paragraph 20ZA(4), |
| |
(d) | the event is the issue or variation of a policy in relation to |
| |
which paragraph 29 of Schedule 39 to the Finance Act 2012 |
| |
| 35 |
(e) | the event is an assignment falling within paragraph |
| |
B2(3)(e) below where the assignment is a mortgage |
| |
| |
(5) | In sub-paragraph (3)(b)(ii) “relevant period” means any period of |
| |
12 months beginning at or after the time of the variation. |
| 40 |
(6) | A variation is to be ignored for the purposes of sub-paragraph |
| |
(3)(b) if its effect is nullified before the end of the period of 3 |
| |
months after the day on which the variation occurs. |
| |
(7) | Sub-paragraph (4)(a)(i) does not apply in the case of an event |
| |
mentioned in sub-paragraph (3)(e). |
| 45 |
(8) | Sub-paragraph (4)(a)(ii) does not apply in the case of— |
| |
(a) | an event mentioned in sub-paragraph (3)(c) or (d) |
| |
occurring in relation to a restricted relief qualifying policy |
| |
| |
|
| |
|
| |
|
(b) | any subsequent event relating to the assigned policy, or |
| |
(c) | any event relating to— |
| |
(i) | a later policy which is a new policy in relation to |
| |
| |
(ii) | any policy which is a new policy in relation to the |
| 5 |
| |
| |
(9) | In the case of an event mentioned in sub-paragraph (3)(b), sub- |
| |
paragraph (4)(a)(iii) applies only if the policy is a pure protection |
| |
policy both before and after the variation. |
| 10 |
(10) | This paragraph is to be applied after all other provisions of this |
| |
Schedule relevant to the question of whether a policy is a |
| |
qualifying policy after an event have been applied. |
| |
Restricted relief qualifying policies |
| |
A2 (1) | Sub-paragraph (2) applies if— |
| 15 |
(a) | an event falling within sub-paragraph (3) occurs, |
| |
(b) | the policy to which the event relates is a qualifying policy |
| |
| |
(c) | an individual who is a beneficiary under that policy is in |
| |
breach of the premium limit for qualifying policies. |
| 20 |
(2) | That policy is to be a restricted relief qualifying policy after the |
| |
| |
(3) | The events falling within this sub-paragraph are— |
| |
(a) | a premium limit event in relation to a protected policy on |
| |
| 25 |
(b) | the issue of a policy as mentioned in paragraph A4(2)(b) |
| |
below if, assuming that the substitution of the protected |
| |
policy were instead a variation of that policy, there would |
| |
be a premium limit event in relation to that policy; |
| |
(c) | the assignment on or after 6 April 2013 of any rights, or any |
| 30 |
share in any rights, under a protected policy where the |
| |
assignment falls within paragraph B2(3)(c) to (g) below; |
| |
(d) | a deceased beneficiary event on or after 6 April 2013 where |
| |
the policy in question is a protected policy; |
| |
(e) | the issue of a policy in respect of an insurance made on or |
| 35 |
after 21 March 2012 but before 6 April 2013 otherwise than |
| |
as mentioned in paragraph A4(2)(b) below; |
| |
(f) | the variation of a policy, other than a protected policy, on |
| |
or after 21 March 2012 but before 6 April 2013 where as a |
| |
| 40 |
(i) | the period over which premiums are payable |
| |
under the policy is or could be lengthened, or |
| |
(ii) | the total amount of the premiums payable under |
| |
the policy in any relevant period is or could be |
| |
| 45 |
| |
|
| |
|
| |
|
(g) | the conditions in either sub-paragraph (3) or sub- |
| |
paragraph (4) of paragraph 24 below being fulfilled for the |
| |
first time in respect of a new non-resident policy where— |
| |
(i) | the conditions are fulfilled for the first time on or |
| |
after 21 March 2012 but before 6 April 2013, and |
| 5 |
(ii) | but for the conditions being fulfilled, the policy |
| |
could not be a qualifying policy because of sub- |
| |
paragraph (2) of paragraph 24. |
| |
(4) | An event does not fall within sub-paragraph (3) if— |
| |
(a) | the policy to which the event relates is a pure protection |
| 10 |
| |
(b) | the event is the issue of a policy which is a new policy in |
| |
relation to an earlier policy where— |
| |
(i) | the new policy is issued in substitution for the |
| |
earlier policy (and not on its maturity), and |
| 15 |
(ii) | the life assured under the new policy is different to |
| |
the life assured under the earlier policy but that is |
| |
the only difference to what the position would |
| |
have been had the earlier policy continued to run, |
| |
(c) | paragraph 20ZA below applies to a policy and the event is |
| 20 |
the reinstatement or replacement of the policy as |
| |
mentioned in paragraph 20ZA(4), |
| |
(d) | the event is the issue or variation of a policy in relation to |
| |
which paragraph 29 of Schedule 39 to the Finance Act 2012 |
| |
| 25 |
(e) | the event is an assignment falling within paragraph |
| |
B2(3)(e) below where the assignment is a mortgage |
| |
| |
(5) | In sub-paragraph (3)(f)(ii) “relevant period” means any period of |
| |
12 months beginning at or after the time of the variation. |
| 30 |
(6) | A premium limit event or a variation is to be ignored for the |
| |
purposes of sub-paragraph (3)(a) or (f) if its effect is nullified |
| |
| |
(7) | In the case of a premium limit event which occurs on or after 6 |
| |
April 2013, in sub-paragraph (6) the reference to 6 July 2013 is to |
| 35 |
be read as a reference to the end of the period of 3 months after the |
| |
day on which the premium limit event occurs. |
| |
(8) | In the case of an event mentioned in sub-paragraph (3)(a) or (f), |
| |
sub-paragraph (4)(a) applies only if the policy is a pure protection |
| |
policy both before and after the premium limit event or variation. |
| 40 |
(9) | A “premium limit event” occurs in relation to a protected policy |
| |
| |
(a) | the policy is varied or a relevant option is exercised so as to |
| |
change the terms of the policy, and |
| |
(b) | as a result of the variation or exercise of the relevant |
| 45 |
| |
(i) | the period over which premiums are payable |
| |
under the policy is or could be lengthened, or |
| |
|
| |
|
| |
|
(ii) | the total amount of the premiums payable under |
| |
the policy in any relevant period is or could be |
| |
| |
| |
(10) | A “premium limit event” also occurs in relation to a protected |
| 5 |
policy if on or after 6 April 2013— |
| |
(a) | the policy is varied or a relevant option is exercised so as to |
| |
change the terms of the policy, and |
| |
(b) | as a result of the variation or exercise of the relevant |
| |
| 10 |
(i) | the period over which premiums are payable |
| |
under the policy is or could be shortened, or |
| |
(ii) | the total amount of the premiums payable under |
| |
the policy in any relevant period is or could be |
| |
| 15 |
| |
(11) | In sub-paragraphs (9)(b)(ii) and (10)(b)(ii) “relevant period” |
| |
means any period of 12 months beginning at or after the time of |
| |
the variation or exercise of the relevant option. |
| |
(12) | The variation of, or exercise of a relevant option under, a protected |
| 20 |
policy is not a premium limit event in relation to the policy if— |
| |
(a) | the policy secures a capital sum payable either— |
| |
(i) | on survival for a specified term, or |
| |
(ii) | on earlier death or on earlier death or disability, |
| |
(b) | the policy is issued and maintained for the sole purpose of |
| 25 |
ensuring that the borrower under an interest-only |
| |
mortgage will have sufficient funds to repay the principal |
| |
lent under the mortgage, and |
| |
(c) | the policy is varied, or the relevant option is exercised, for |
| |
| 30 |
(13) | In sub-paragraph (3)(g) references to paragraph 24 below are to |
| |
that paragraph as it has effect before the appointed date for the |
| |
purposes of section 55 of the Finance Act 1995. |
| |
(14) | A qualifying policy which is a new policy in relation to an earlier |
| |
policy is a restricted relief qualifying policy if the earlier policy is |
| 35 |
a restricted relief qualifying policy. |
| |
(15) | A policy which is a restricted relief qualifying policy remains a |
| |
restricted relief qualifying policy so long as it is a qualifying |
| |
| |
(16) | Paragraph A1 above is to be ignored in determining for the |
| 40 |
purposes of sub-paragraph (14) or (15) if a policy is a qualifying |
| |
| |
| This is subject to paragraph A1(8). |
| |
(17) | For further provision about restricted relief qualifying policies, see |
| |
sections 463A to 463D of ITTOIA 2005. |
| 45 |
|
| |
|
| |
|
The premium limit for qualifying policies |
| |
A3 (1) | For the purposes of paragraphs A1(1)(c) and A2(1)(c) above an |
| |
individual is in breach of the premium limit for qualifying policies |
| |
if the total amount of the premiums payable under relevant |
| |
policies in any relevant period— |
| 5 |
| |
(b) | could exceed £3,600 as a result of— |
| |
(i) | the exercise of any one or more relevant options |
| |
conferred by one or more relevant policies, or |
| |
(ii) | so far as not covered by sub-paragraph (i), the |
| 10 |
application of one or more terms of one or more |
| |
relevant policies relating to increases in premiums. |
| |
(2) | For the purposes of sub-paragraph (1)— |
| |
(a) | so much of a premium payable under a relevant policy as |
| |
is charged on the grounds that an exceptional risk of death |
| 15 |
or disability is involved is to be left out of account in |
| |
determining the premiums payable under the policy, |
| |
(b) | so much of the first premium payable under a relevant |
| |
policy the liability for the payment of which— |
| |
(i) | is discharged in accordance with paragraph 15(2) |
| 20 |
| |
(ii) | in the case of a policy in relation to which |
| |
paragraph 3 below applies, is discharged under a |
| |
provision of the policy falling within paragraph |
| |
| 25 |
| is to be left out of account in determining the premiums |
| |
payable under the policy (subject to sub-paragraph (3) |
| |
| |
(c) | in determining the premiums payable under a relevant |
| |
policy any provision for the waiver of premiums by reason |
| 30 |
of a person’s disability is to be ignored, and |
| |
(d) | “relevant period” means any period of 12 months |
| |
beginning at or after the time when the event falling within |
| |
paragraph A1(3) or A2(3) above (“the relevant event”) |
| |
| 35 |
(3) | The maximum amount that may be left out of account under sub- |
| |
paragraph (2)(b) in the case of a relevant policy is—![equation: cross[string["\xa3 3,600"],char[N]]](missing.gif) |
| |
| where N is the number of complete years for which ran— |
| |
(a) | the other policy involved, or |
| |
(b) | if there is more than one other policy involved, the policy |
| 40 |
which ran for the most number of complete years. |
| |
(4) | For the purposes of this paragraph the following are “relevant |
| |
| |
(a) | the policy to which the relevant event relates, and |
| |
| 45 |
(i) | which is a qualifying policy, and |
| |
(ii) | under which the individual is a beneficiary. |
| |
|
| |
|
| |
|
(5) | But neither a protected policy nor a pure protection policy is to be |
| |
a relevant policy by virtue of sub-paragraph (4)(b). |
| |
(6) | Sub-paragraph (7) applies if this paragraph is to be applied in the |
| |
case of an individual in consequence of two or more events |
| |
occurring at the same time (including where one or more of the |
| 5 |
events falls within paragraph A1(3) above and one or more of the |
| |
events falls within paragraph A2(3) above). |
| |
(7) | For the purpose of applying this paragraph in the case of the |
| |
individual in consequence of any of the events, sub-paragraph |
| |
(4)(a) has effect as if the reference to the policy to which the |
| 10 |
relevant event relates were a reference to all the policies to which |
| |
the events, taken together, relate. |
| |
(8) | But sub-paragraph (7) does not apply, and sub-paragraph (9) |
| |
| |
(a) | all the policies in question are policies issued by the same |
| 15 |
| |
(b) | each of them has an unique identifier in a series of unique |
| |
identifiers which the issuer gives to policies issued by it. |
| |
(9) | For the purpose of applying this paragraph in the case of the |
| |
individual in consequence of any of the events, an event relating |
| 20 |
to a policy (“policy A”) is treated as occurring before an event |
| |
relating to another policy (“policy B”) if, in the issuer’s series of |
| |
unique identifiers, policy A’s unique identifier comes before |
| |
policy B’s unique identifier. |
| |
| 25 |
A4 (1) | This paragraph applies for the purposes of this Part of this |
| |
| |
(2) | A policy is “protected” if— |
| |
(a) | it is issued in respect of an insurance made before 21 March |
| |
| 30 |
(b) | it is issued in respect of an insurance made on or after 21 |
| |
| |
(i) | it is a new policy in relation to an earlier policy, |
| |
(ii) | it is issued in substitution for the earlier policy (and |
| |
not on its maturity), and |
| 35 |
(iii) | the earlier policy is a protected policy (whether by |
| |
virtue of paragraph (a) or this paragraph). |
| |
(3) | A policy which is protected ceases to be protected if it becomes a |
| |
restricted relief qualifying policy. |
| |
(4) | A policy issued as mentioned in sub-paragraph (2)(b) is not |
| 40 |
| |
(a) | its issue is an event falling within paragraph A2(3) above, |
| |
| |
(b) | after that event it is a restricted relief qualifying policy. |
| |
|
| |
|
| |
|
How to determine if an individual is a beneficiary under a policy |
| |
A5 (1) | This paragraph applies for the purposes of this Part of this |
| |
Schedule in determining if an individual is a beneficiary under a |
| |
| |
(2) | An individual is a beneficiary under a policy if the individual |
| 5 |
| |
(a) | any rights under the policy, or |
| |
(b) | any share in any rights under the policy. |
| |
(3) | An individual is a beneficiary under a policy if— |
| |
(a) | any rights under the policy are, or any share in any rights |
| 10 |
under the policy is, held on non-charitable trusts created |
| |
| |
(b) | those rights are, or that share is, not beneficially owned by |
| |
| |
(4) | The following provisions of ITTOIA 2005 apply for the purposes |
| 15 |
| |
| |
(b) | the definition of “non-charitable trust” in section 545(1). |
| |
(5) | An individual is a beneficiary under a policy if— |
| |
(a) | any rights under the policy are, or any share in any rights |
| 20 |
under the policy is, held as security for a debt of the |
| |
| |
(b) | those rights are, or that share is, not beneficially owned by |
| |
| |
| 25 |
A6 (1) | In this Part of this Schedule— |
| |
(a) | “new policy” has the meaning given in paragraph 17 |
| |
| |
(b) | references to the variation of a policy are to a variation in |
| |
relation to which paragraph 18 below applies, |
| 30 |
(c) | “pure protection policy” means a policy— |
| |
(i) | which has no surrender value and is not capable of |
| |
acquiring a surrender value, or |
| |
(ii) | under which the benefits payable cannot exceed |
| |
the amount of the premiums paid except on death |
| 35 |
or in respect of disability, and |
| |
(d) | “relevant option”, in relation to a policy, means an option |
| |
conferred by the policy on the person to whom it is issued |
| |
to have another policy substituted for it or to have any of |
| |
| 40 |
(2) | For the purposes of this Part of this Schedule a “deceased |
| |
beneficiary event” occurs if, in connection with the death of an |
| |
individual (“D”) who was a beneficiary under a policy, an |
| |
individual (“B”) becomes a beneficiary under that policy by |
| |
reference (wholly or partly) to any rights, or to any share in any |
| 45 |
|
| |
|