Insurance Premium Tax Rate Changes from the 1 June 2017
As you are no doubt aware, from the 1st June 2017 the rate for Insurance Premium Tax (IPT) will increase from 10% to 12%.
What does this mean for Tax Fee Protection Insurance?
If your scheme incepts or renews after the 1st June 2017 the new rate will apply to all clients who purchase and we will provide you with documentation that reflects this.
If your scheme incepts or renews before the 1st June 2017, clients who purchase for the full Policy Period will be subject to IPT at the existing 10% rate. However if you have a client who joins the scheme part way through (for a short period) who begins after the 1st June 2017, IPT will be applicable at the new 12% rate.
So for example, if you scheme Policy Period runs from 1st January 2017 to 31st December 2017 and a client wants to join the scheme in May 2017 (through to the 31st December renewal date) IPT will be applicable at 10%. If however the client joins the scheme in August 2017 (after the 1st June 2017) IPT will be applicable at 12%.
This will in the main impact ‘client decide’ schemes, but could equally apply to ‘all client’ schemes where you recover premium by writing to your clients.
Qdos Vantage TFP Scheme Clients
Please remember to adjust your premiums to take account of this change when clients join part way through the Policy Period. We have Premium Statements that apply the higher rate. If you would like one please contact us on 0116 274 9123.
Or if you have any questions regarding this change, please contact your BDM.