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444ABA | Relevant non-transferred assets |
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(1) | For the purposes of section 444AB the relevant amount in relation to |
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assets that are relevant non-transferred assets is—![equation: plus[times[char[F],char[V],char[A]],minus[times[char[R],char[V],char[A]]]]](missing.gif) |
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FVA is the fair value of the assets on the transfer date, and |
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RVA is the recognised value of the assets. |
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(2) | For the purposes of this section and section 444ABB— |
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(a) | the recognised value of any assets which, immediately before |
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the transfer date, are held by the transferor in a non-profit |
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fund which is not a Form 14 line 51 fund is the relevant Form |
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13 value of those assets, and |
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(b) | the recognised value of any other assets is the appropriate |
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fraction of the relevant Form 13 value of those assets. |
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(3) | For the purposes of subsection (2) above a non-profit fund is a Form |
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14 line 51 fund if an amount in respect of the fund is shown (or |
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treated as shown) in line 51 of Form 14 in the periodical return of the |
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transferor covering the relevant period of account. |
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(4) | For the purposes of subsection (2) above the relevant Form 13 value |
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of any assets is the value which is shown (or treated as shown) in |
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respect of the assets in Form 13 in the periodical return of the |
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transferor covering the relevant period of account (ignoring lines 91 |
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(5) | For the purposes of subsection (2)(b) above the appropriate fraction |
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is![equation: plus[num[1.0000000000000000,"1"],minus[over[char[A],char[B]]]]](missing.gif) |
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A is the amount shown (or treated as shown) in line 51 of Form |
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14 in the periodical return of the transferor covering the |
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relevant period of account in respect of the fund in which, |
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immediately before the transfer date, the assets are held by |
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the transferor, increased or reduced as mentioned in |
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subsection (6) below, and |
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B is the amount shown (or treated as shown) in line 89 of Form |
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13 in that periodical return in respect of that fund. |
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(6) | The increase or reduction referred to in the definition of A in |
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subsection (5) above is any increase or decrease deemed to be |
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brought into account by section 83YA(3) or (4) of the Finance Act |
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1989 in respect of the fund for the relevant period of account. |
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(7) | See section 444AA for the meaning of “the transfer date”, and section |
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444AB for the meaning of “the relevant period of account”, in this |
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(1) | For the purposes of section 444AB the relevant amount in relation to |
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assets that are retained assets is the lesser of FVA and UTA, where— |
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(a) | FVA is the fair value of the assets on the transfer date, and |
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(b) | UTA is the amount by which the fair value of the assets of the |
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long-term insurance fund of the transferor immediately |
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before the transfer date exceeds the amount shown (or |
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treated as shown) in line 32 of Form 40 in the periodical |
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return of the transferor covering the transfer date. |
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(2) | See section 444AA for the meaning of “the transfer date” in this |
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444ABC | Transfer scheme transferring part of business: transferor |
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(1) | This section applies where an insurance business transfer scheme |
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has effect to transfer part (but not the whole or substantially the |
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whole) of the long-term business of a person (“the transferor”) to |
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another person (“the transferee”) and the condition in subsection (2) |
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(2) | That condition is that any of the assets of the transferor’s long-term |
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insurance fund which are transferred from the transferor to the |
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transferee by the insurance business transfer scheme are not, |
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immediately after their transfer— |
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(a) | if the transferee is an insurance company, assets of the |
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transferee’s long-term insurance fund, or |
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(b) | if the transferee is not an insurance company, assets of a with- |
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profits fund of the transferee, |
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| (“relevant non-transferred assets”). |
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(3) | The relevant amount in relation to the relevant non-transferred |
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assets (see subsection (4) below) is to be taken into account under |
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section 83(2) of the Finance Act 1989 as an increase in value of the |
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assets of the long-term insurance fund of the transferor for the period |
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of account covering the transfer date. |
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(4) | The relevant amount in relation to the relevant non-transferred |
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assets is—![equation: plus[times[char[F],char[V],char[A]],minus[times[char[B],char[T],char[O]]]]](missing.gif) |
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FVA is the fair value of the assets on the transfer date, and |
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BTO is any amount brought into account in respect of the assets |
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as a business transfer-out. |
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(5) | See section 444AA for the meaning of “the transfer date” in this |
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(2) | In section 432E(2A) of ICTA (apportionments: participating funds)— |
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(a) | before “444AF(2)” insert “444AB, 444ABC,”, and |
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(b) | after paragraph (a) insert— |
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“(aa) | section 444AB or 444ABC of this Act;”. |
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Transferor’s period of account including transfer |
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5 | In ICTA, after section 444ABC (inserted by paragraph 4) insert— |
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“444ABD | Transferor’s period of account including transfer |
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(1) | Any profits representing the amount by which— |
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(a) | the value of the liabilities transferred by an insurance |
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business transfer scheme, exceeds |
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(b) | the value of the assets transferred by the insurance business |
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transfer scheme shown (or treated as shown) in line 32 of the |
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periodical return of the transferor for the period of account of |
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the transferor including the transfer date, |
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| are to be taken into account as profits of that period of account. |
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(2) | Any loss representing the amount by which— |
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(a) | the value of the liabilities transferred by an insurance |
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business transfer scheme, falls short of |
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(b) | the value of the assets transferred by the insurance business |
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transfer scheme shown (or treated as shown) in line 32 of the |
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periodical return of the transferor for the period of account of |
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the transferor including the transfer date, |
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| is to be taken into account as a loss of that period of account. |
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(3) | See section 444AA for the meaning of “the transfer date” in this |
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Transfer schemes: taxing the transferee |
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6 (1) | In ICTA, for section 444AC substitute— |
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“444AC | Transfer schemes transferring whole of business: reduction in |
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(1) | This section applies where an insurance business transfer scheme |
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has effect to transfer the whole, or substantially the whole, of the |
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long-term business of a person (“the transferor”) to another person |
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(“the transferee”) and conditions A and B are met. |
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(2) | Condition A is that the transferor did not carry on life assurance |
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business that is mutual business during the relevant period of |
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(3) | Condition B is that an amount is shown (or treated as shown) in line |
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13 of Form 14 in the periodical return of the transferor covering the |
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relevant period of account. |
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(4) | The amount which (apart from this section) would be regarded as |
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other income of the transferee for the purposes of section 83(2)(e) of |
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the Finance Act 1989 for the period of account of the transferee which |
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includes the transfer date is to be reduced by an amount equal to the |
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(5) | In subsection (4) above “the transferred surplus” means the amount |
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shown (or treated as shown) in line 13 of Form 14 in the periodical |
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return of the transferor covering the relevant period of account. |
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(6) | See section 444AA for the meaning of “the transfer date”, and section |
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444AB for the meaning of “the relevant period of account”, in this |
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444ACZA | Transfer schemes transferring part of business: reduction in |
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(1) | This section applies where an insurance business transfer scheme |
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has effect to transfer part (but not the whole or substantially the |
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whole) of the long-term business of a person (“the transferor”) to |
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another person (“the transferee”) and the condition in subsection (2) |
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(2) | The condition is that the transferor did not carry on life assurance |
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business that is mutual business during the period of account of the |
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transferor covering the transfer date. |
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(3) | The amount which (apart from this section) would be regarded as |
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other income of the transferee for the purposes of section 83(2)(e) of |
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the Finance Act 1989 for the period of account of the transferee which |
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includes the transfer date is to be reduced by an amount equal to the |
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(4) | In subsection (4) above “the transferred surplus” means such part of |
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the amount shown (or treated as shown) in line 13 of Form 14 in the |
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periodical return of the transferor covering the last period of account |
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of the transferor ending before the transfer date as it is just and |
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reasonable to regard as being attributable to the transfer. |
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(5) | See section 444AA for the meaning of “the transfer date” in this |
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(2) | In section 83(2A) of FA 1989 (receipts not to be taken into account), omit |
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7 (1) | In ICTA, omit section 444AD (transfers of business: modification of section |
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(2) | In section 83YA(7) of FA 1989 (changes in value of assets brought into |
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account: transfer-in amount), for the words after “if” substitute “a transfer |
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takes place in the following period of account; and the amount of the |
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transfer-in amount for the previous period of account is any amount by |
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(a) | the fair value of such of the assets of the long-term insurance |
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fund of the company immediately after the transfer as were |
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assets of the transferor’s long-term insurance fund |
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immediately before the transfer, exceeds |
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(b) | the amount of any business transfer-in brought into account |
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in accordance with section 83(2)(e) in relation to the transfer.” |
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Transfer schemes: anti-avoidance |
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8 (1) | In ICTA, before section 444AF (and the italic cross-heading before it) |
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“444AEA | Transfer schemes: anti-avoidance rule |
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(1) | This section applies where— |
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(a) | as a result of the whole or any part of transfer scheme |
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arrangements involving the transfer of long-term business |
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from one person (“the transferor”) to another (“the |
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transferee”) a Case I advantage is obtained by the transferor |
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or the transferee (or by both), and |
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(b) | the sole or main purpose, or one of the main purposes, of the |
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whole or any part of the transfer scheme arrangements is the |
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obtaining of that Case I advantage. |
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(2) | In subsection (1) above “transfer scheme arrangements” means an |
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insurance business transfer scheme (“the relevant transfer scheme”) |
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together with any relevant associated operations. |
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(3) | If a Case I advantage is obtained by the transferor (see subsection (1) |
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of section 444AEB), the amount of the transferor’s Case I advantage |
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(see subsection (2) of that section) is to be taken into account as an |
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increase in value of the assets of the long-term insurance fund of the |
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transferor for the period of account of the transferor covering the |
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(4) | If a Case I advantage is obtained by the transferee (see subsection (1) |
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of section 444AEC), the amount of the transferee’s Case I advantage |
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(see subsection (2) of that section) is to be taken into account as an |
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increase in value of the assets of the long-term insurance fund of the |
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transferee for the first period of account of the transferee ending after |
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(5) | In this section and sections 444AEB and 444AEC “relevant associated |
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operations”, in relation to the relevant transfer scheme, means— |
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(a) | any other insurance business transfer scheme, |
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(b) | any contract of reinsurance, |
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(c) | any reconstruction or amalgamation involving the transferor, |
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a dependant of the transferor which is an insurance |
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undertaking or the transferee, or |
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(d) | any surplus-increasing transfer of assets, |
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| which is effected in connection with the relevant transfer scheme. |
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(6) | In subsection (5) above— |
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“dependant” and “insurance undertaking” have the same |
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meaning as in the Insurance Prudential Sourcebook, and |
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“surplus-increasing transfer of assets” means a transfer of assets |
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of the transferor’s long-term insurance fund to the transferee |
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which is not brought into account for any period of account |
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of the transferee but increases the amount of total surplus |
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shown in line 39 of Form 58 in any periodical return of the |
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(7) | See section 444AA for the meaning of “the transfer date” in this |
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