Network with Captive Review on LinkedIn

Follow Captive Review on Twitter

RSS

18th of May 2012

Tax volatility to increase if UK CERs go

Vicky Beckett 24/11/2011

UK parented captives may face more volatility in taxes, depending on the outcome of the UK’s Chancellor of the Exchequer’s Autumn Budget Statement.
 
George Osborne is due to release his Autumn Budget Statement on November 29 which will impact all UK-based and parented insurance companies.
 
Ian Woodruff, Grant Thornton director of tax, predicted that claims equalisation reverses (CERs) may be abolished for UK companies in the statement.
 
This will impact captives parented by UK companies due to controlled foreign company (CFC) rules.
 
If CERs were to be stopped, UK-owned captives may need higher reserves.
 
However Praveen Sharma, insurance, regulatory and tax consulting senior vice-president at Marsh, said: “I do not believe this is proposed legislation. It is a consultation.”
 
Howard Jones, head of insurance tax services for Mazars, said: “We expect CER to be abolished (because of IFRS and Solvency II) and we may see draft legislation on the December 6. 
 
“I don't think that it will make a significant change to reserving and it will change the tax charge.  
 
“The transitional provisions will be key as to how the government will recoup the CER previously claimed by companies. 
 
“I assume that it will be over a number of years say 6 to 10 because there are some large CERs out there.”
 

Tags: Autum budget statement, Captive, CER, Claims, Claims reserves, Equalisation, Isnurance, Reserves, Tax, UK

Post a comment

Post a comment

Be the first to comment on this article!

Captive Insurance Database (CID)is the world's most comprehensive online source of captive market intelligence.

CID gives users instant access to the names of parent companies who currently own a captive. It also provides the names and contact details of captives’ risk managers, as well as the parent or ultimate parent companies’ address, country, CFO, CEO, and exchange.

CID also gives you the captive name, manager, licence and incorporation date and the type of captive the parent company is running.

CID will help you to:

•    Win more business proactively – Search from 5,700 captives and over 3,700 captive owners who you can offer your services to.


•    Increase profit and efficiency – Target specific captive owners and sponsors quicker, saving you time.


•    Build relationships
Access detailed contact information for each decision-maker. 

An annual CID licence costs just £1,195 + VAT.

Already a CID user?Login here.

Order a 2 year subscription and SAVE 25%
The licence includes full online access to CID and a free annual hardcopy of CID (worth £610).To find out more contact Nick Byrne on +44 (0) 20 7029 4027 or
cid@captivereview.com.

more//

Company and Ratings Search

Search A.M. Best's extensive database of life/health, property/casualty and insurance companies worldwide.

more//

Cell Company Guide

WELCOME TO THE Captive Review Cell Company Handbook 2009 – the second edition of our global directory of cell company jurisdictions. Since we last published this directory, the general attitude toward cell companies seems to have shifted up a gear. Whereas single-parent companies have long ruled the captive roost, a slight uptick in the formation of pure captives at the beginning of this year can’t hide the fact that growth in this market is still sluggish.

more//

Pellentesque feugiat arcu vitae lacus elementum in ullamcorper diam pulvinar. In odio massa, facilisis sed dignissim vel, vehicula ac diam. Curabitur tempor, quam nec aliquam tempus, dui lorem venenatis arcu

Mauris accumsan orci ut turpis placerat condimentum. Ut sit amet lobortis purus. Class aptent taciti sociosqu ad litora torquent per conubia nostra, per inceptos himenaeos.

CID