The Association of
Taxation Technicians (ATT) has received confirmation from HMRC that the FA 2020
s 37 changes to the calculation of top slicing relief in relation to chargeable
event gains on life insurance policies will also be applied in practice for the
2018/19 tax year. The changes allow individuals to retain the benefit of their
personal allowance when calculating the amount of available top slicing relief,
where the chargeable event gain takes their total income over £100,000.
The Finance Act provisions
took effect from 11 March 2020. This led to questions around how people with
chargeable event gains prior to that date should calculate their tax. In
response, HMRC has confirmed that FA 2020 s 37 will be applied by concession to
any gains in both the 2018/19 and 2019/20 tax years. This is an extension of
the position in Agent Update 78, which indicated that HMRC would only
apply the new provisions to 2019/20 gains.
The Association of
Taxation Technicians (ATT) has received confirmation from HMRC that the FA 2020
s 37 changes to the calculation of top slicing relief in relation to chargeable
event gains on life insurance policies will also be applied in practice for the
2018/19 tax year. The changes allow individuals to retain the benefit of their
personal allowance when calculating the amount of available top slicing relief,
where the chargeable event gain takes their total income over £100,000.
The Finance Act provisions
took effect from 11 March 2020. This led to questions around how people with
chargeable event gains prior to that date should calculate their tax. In
response, HMRC has confirmed that FA 2020 s 37 will be applied by concession to
any gains in both the 2018/19 and 2019/20 tax years. This is an extension of
the position in Agent Update 78, which indicated that HMRC would only
apply the new provisions to 2019/20 gains.