Regulation 11 Reinsurance to close amountsI1

United Kingdom

(1)

The reinsurance to close amount to be treated as a technical provision in the case of a member of a Lloyd’s syndicate for a period of account is whichever is the lesser of—

(a)

the total of the reinsurance to close amounts which the member pays or gives, or is treated as paying or giving, in respect of the underwriting year for which profits or losses are declared; and

(b)

the total of the reinsurance to close amounts which the member receives, or is treated as receiving, in respect of the underwriting year for which profits or losses are declared.

This paragraph is subject to paragraph (2).

(2)

If a company—

(a)

pays or gives, or is treated as paying or giving, a reinsurance to close amount to a member in respect of an underwriting year for which profits or losses are declared, and

(b)

the company is connected to the member,

the amount which the member receives, or is treated as receiving, shall also be treated as a reinsurance to close amount paid by the member in respect of that underwriting year.

(3)

For the purposes of paragraph (2), section 839(5) to (8) of the Income and Corporation Taxes Act 1988^f1 (connected persons) applies for the purpose of determining whether a company is connected to a member.

Annotations

Commencement

I1: Reg. 11 in force at 1.9.2009, see reg. 1(1)

Footnotes

f1: c.1; section 839 has been amended but none of the amendments are relevant.