As you might be aware, the Standard UK Insurance Premium Tax (IPT) Rate rose from 6% to 9.5% on 1st November 2015 in light of the Summer Budget announced by the Government in July.
This increase relates to all new business, renewals and mid-term additional premiums for mid-term adjustments.
New Business & Renewals:
All new business and renewals with an inception/renewal date on or after 1st November 2015 will be charged at 9.5%.
New business and renewals with an inception date prior to the 1st November 2015 will be charged at 6%.
Mid-Term Adjustments (MTAs):
For any MTA which results in a reduction in premium, the refund amount will reflect the original rate of IPT. This means:
- Effective date of MTA before 1st November 2015: 6%
- Effective date of MTA on or after 1st November 2015: 6%
For any MTA which results in an additional premium, the amount will reflect the following rates of IPT:
- Effective date of MTA before 1st November 2015: 6%
- Effective date of MTA on or after 1st November 2015: 9.5%
The IPT charges outlined will be based on the effective date of a transaction.
Please do not hesitate to contact our team if you would like more information about these changes.