Increase in IPT from 01.11.15

Comments

8 comments

  • Avatar
    Mark Williams

    This could be solved by introducing "On Cover" rules and/or matrix. This would allow the IPT to be changed when cover is requested dependant upon the inception date. This would be useful in other areas too.

  • Avatar
    Colin Kippin

    Hi Amanda,

    We are currently awaiting a clarification of the exact rules to apply from BIBA - we are assuming that the change is effective date based but need to check that its not processing date.

    Once we have the final details we will be issuing some guidance notes as to the changes that you need to make to your Schemes so that you can process New Business, Adjustments and Renewals correctly.

    We will also need to look at the scenario you mention above assuming its inception date based where a quote was given at 6% but as the new inception date is after 1st Nov it now needs to be closed off at 9.5%

    Regards

     

    Colin

     

     

  • Avatar
    Amanda Kelly

    Thanks Mark for your thoughts - just not sure how to manage giving the customer another quote if they need one at the higher rate - presume that all cases where quotes were given before 01.11.15 but where they try to put a case On Cover after the 01.11.15 will need to refer back for a requote perhaps.

    Colin

    An extract from the budget is as below:

    'Indirect taxes

    Insurance premium tax standard rate – From 1 November 2015, the standard rate of insurance premium tax (IPT) will be increased by 3.5 percentage points to 9.5%. From this date all premiums received by insurers using the IPT cash accounting scheme will be charged at 9.5%. For insurers using the special accounting scheme, there will be a 4 month concessionary period that will begin on 1 November 2015 and end on 29 February 2016, during which premiums received that relate to policies entered into before 1 November 2015 will continue to be liable to IPT at 6%. From 1 March 2016 all premiums received by insurers will be taxed at the new rate of 9.5%, regardless of when the policy was entered into. (Summer Finance Bill 2015) (19)'

    Not sure if this helps!

    Look forward to hearing further in due course.

    Amanda

  • Avatar
    Natalie Williams

    This is where rules based on inception date would be invaluable.

    We will all need a rule to set the IPT rate to the higher value. This can be added under the On Cover status.

    The rule by case inception date (and record inception date) is becoming more and more necessary.

    Thanks

  • Avatar
    Colin Kippin

    We will look at all solutions shortly, Rules is one possible solution but there are others revolving around Taxes in general.

    Will report back with proposed solutions as soon as we can

  • Avatar
    Amanda Kelly

    Morning Colin

    Just wondered whether we were any closer to a solution for this as we are now only a month away from needing to implement something - as we can issue policies 30 days in advance.

    Regards

    Amanda

  • Avatar
    Colin Kippin

    Hi Amanda,

    We have completed this work and it was included in the most recent release.

    There will be some rules that you need to create to set the new rates - we will be releasing an instruction video to all users in the next couple of days so that you can get these in place.

    Regards

    Colin

  • Avatar
    Adam MacDonald

    A video showing you how to set your rules up that has been sent to all site owners is below.  

    https://www.youtube.com/watch?v=WdJdgFYsVYM

    Any question please either raise a support ticket or give the helpline a call. 

    Kind regards

    Adam

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