Life insurance policy gains: full Personal Allowance available
The recently enacted Finance Act 2020 (FA 2020) allows individuals to retain the benefit of their Personal Allowance (currently £12,500) when calculating the amount of available TSR, rather than accept it as abated if the chargeable event gain took their total income over £100,000.
HMRC has confirmed that it will apply the FA 2020 changes to the calculation of TSR to any gains in both 2018-19 and 2019-20 tax years ‘by concession’. For significant gains, the tax saving/refund available may be material.
In certain circumstances it may also be possible to claim a refund of tax paid for gains in 2016-17 and 2017-18.
If you should have any questions on the above, please contact Katharine Arthur or your usual haysmacintyre contact.