We support a tax regime that supports UK growth. The Total Tax Contribution of our members is £18.5 billion a year for both taxes borne and collected on behalf of HMRC by our members. We are keen that tax policies support the right behaviours and that the compliance burden is proportionate to the objectives of the underlying policy. 

A current focus is the implementation of the OECD Pillar 2 rules, which aim to establish a global minimum tax rate. We are engaging with HMRC/HMT to try to ensure that these rules are applied fairly to prevent competitive disadvantages for UK insurers. Our advocacy focuses on aligning international tax regulations with the needs of our members, ensuring compliance while promoting a level playing field globally. By engaging with stakeholders, we support the competitiveness and stability of the UK insurance sector, helping it navigate the complexities of global tax reforms. 

We engage with industry stakeholders and policymakers with regard to the application of VAT (Value Added Tax) for Financial Services. Our goal is to reduce inconsistencies and provide greater clarity and certainty for the insurance and long-terms savings industry. We advocate for reforms that improve legal clarity and ensure the VAT system supports UK competitiveness. 

IPT (Insurance Premium Tax) is a regressive tax that hits the poorest hardest and we campaign for fair Insurance Premium Tax (IPT) rates. We also work with HMRC and other authorities to streamline the IPT administrative process, ensuring there is clarity regarding how the rules should be applied, and making it more efficient and less burdensome for insurers. Our efforts focus on balancing the tax burden, ensuring it supports the growth and sustainability of the insurance market. By advocating for a simplified and fair IPT system, we aim to enhance the industry's competitiveness and economic contribution. 

We consider both the tax regime applied to pensions and life policies and how this is applied in practice. On the former, we engage with Government to try and correct anomalies – such as the ‘net pay anomaly’. On the latter, we advocate for fair treatment in legislation and appropriate penalty regimes where errors do occur. Our efforts ensure that tax policies benefit both insurers and policyholders, supporting the industry's growth while protecting consumer interests. By engaging with regulatory bodies and providing detailed feedback on proposed changes, we aim to create a favourable environment for long-term savings and investments. Our advocacy helps to foster a tax system that is equitable, transparent, and supportive of the industry's objectives. 

We support HMRC’s Making Tax Digital (MTD) initiatives. We participate in working groups such as the Digitisation of Relief at Source (DIGIRAS), Digitisation of ISAs (DISA), and MTD for VAT. Our focus is on reducing administrative burdens and enhancing the accuracy and transparency of tax reporting through digitalisation. By advocating for effective digital tax solutions, we aim to improve the efficiency and reliability of tax processes, benefiting both the industry and taxpayers. 

This is a new unauthorised fund vehicle expected to be of interest to the property industry. Tax treatment is proposed to be similar to the Co-ACS fund structure, and these regulations consult on the precise mechanics. The regulation also includes a proposed (welcome) tweak to the treatment of capital allowances for insurance companies investing into property Co-ACS structures. 

HMRC are looking at all aspects of tax administration taking a holistic view across all taxes and covering areas such as time limits and penalties. 

Following a number of previous consultations HMRC are now looking at different options for registration and supervision of tax advisers. The scope of the requirements to be in the regime will be of interest to many different stakeholders in the insurance and long-term savings industry. 

The Government have proposed a new ‘UK ISA’, providing an additional allowance provided it is invested into UK equities. The scope (e.g. treatment of funds) and mechanics (e.g. transfers in and out of the UK USA) are areas of particular interest. 

The structural assets of life insurers are usually treated as long-term business fixed capital for tax purposes. These regulations define what should be within this category, and result from extensive industry engagement with HMRC. 

This consultation is wide-ranging and includes reporting obligations in respect of cryptoasset investments and of particular relevance to ABI members a proposed extension of CRS reporting obligations in respect of domestic accounts.