Finance Act, 1998
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Amendment of section 715 (annuity business: separate charge on profits) of Principal Act. |
64.—(1) Section 715 of the Principal Act is hereby amended in subsection (2) by the substitution for paragraph (a) of the following paragraph: | |
“(a) (i) subject to subparagraphs (ii), (iii) and (iv), subsection (1) of section 710 shall apply with the necessary modifications and in particular shall apply as if there were deleted from that subsection all references to policyholders other than holders of policies referable to pension business, | ||
(ii) where apart from this subparagraph any profits would be excluded in making the computation solely by virtue of that part being reserved for holders of policies referable to pension business, that part shall not be so excluded, | ||
(iii) in relation to investments of any fund representing the amount of the liabilities of the company to policyholders in respect of its pension business or general annuity business, as the case may be, | ||
(I) any increase in value of those investments (whether realised or unrealised) shall be taken into account as a receipt, and | ||
(II) any decrease in value of those investments (whether realised or unrealised) shall be taken into account as an expense, | ||
to the extent that the increase or decrease, as the case may be, is included in the value of those liabilities as valued by the actuary to the company, and | ||
(iv) where the profits of an assurance company for an accounting period (in this subparagraph referred to as ‘the first accounting period’) are computed in accordance with subparagraph (iii) and the profits of the most recent preceding accounting period are not so computed, the increase or decrease in the value of investments referred to in subparagraph (iii) shall as respects the first accounting period be computed by reference to the cost of the investments at the time they were acquired by the company and such increase or decrease shall be treated as a receipt or as an expense, as the case may be.”. | ||
(2) This section shall apply as respects an accounting period of a company ending on or after the 4th day of March, 1998. |