Commentary

D7.468 BLAGAB trade profit or loss—Policyholder tax

Corporate tax
Corporate tax | Commentary

D7.468 BLAGAB trade profit or loss—Policyholder tax

Corporate tax | Commentary

D7.468 BLAGAB trade profit or loss—Policyholder tax

The rules in this division apply for accounting periods beginning on or after 1 January 2013. For accounting periods beginning before 1 January 2013 see Division D7.5.

In calculating the BLAGAB trade profit or loss the company must take the amount of policyholder tax of the period, both current and deferred, into consideration. Normally tax borne by a company is not taken into account in calculating its trading profits but it is acknowledged that for an insurance company, tax borne on behalf of policyholders is a proper component of the BLAGAB trade profit as a natural consequence of the purpose of the I-E system in collecting tax from both policyholders and shareholders in one sum. It should be noted that depending on economic circumstances the amount of deferred policyholder tax taken into account may either be a deduction if there is a deferred

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