Revenue Note for Guidance

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Revenue Note for Guidance

727 General annuity and pension business

Summary

This section sets out rules for the computation of profits of an overseas life assurance company from its general annuity and pension business.

Details

(1) In computing, for the purposes of section 715, the profits of an overseas life assurance company in respect of its general annuity business and pension business, distributions received from Irish resident companies are brought into account.

(2) The charge to corporation tax for an accounting period in respect of the general annuity business of an overseas life assurance company extends only to a portion of the profits arising from that business. The portion is determined by the formula —

A × B

C

A

is the total amount of the profits.

B

is the average of the liabilities in respect of the company’s general annuity business for the period in respect of contracts with Irish resident policyholders or contracts with persons resident outside the State whose proposals were made to the company at or through a branch or agency in the State.

C

is the average of the liabilities attributable to general annuity business for the period in respect of all contracts.

The liabilities attributable to general annuity business are arrived at by reference to the net liabilities as valued by an actuary for the purposes the relevant periodical return.

(3) The average of the liabilities for an accounting period is 50 per cent of the aggregate of the liabilities at the beginning and end of the valuation period which coincides with that accounting period or in which that accounting period falls.

Relevant Date: Finance Act 2021