Foreign Insurance Policy

Hello, I have a part surrender of a life policy. The total surrender amount received is less than the total premium amount being paid, is it treated as "no gain". If yes, do I need to report this "no gain"? Thank you, Karen

Hi Karen,
The result of the calculation when a chargeable event arises may not be a positive amount.
There’s no relief for a loss and you should not make any entries on your tax return.
However, if the result of a full surrender, death or maturity calculation is negative and you made gains on the policy in earlier years, the section that follows about ‘deficiency relief’ may be relevant.
A loss on one policy cannot be set off against a gain on another policy.
Thank you. 

 

Hello, Thanks to confirm that a loss is not required to report (total premiums amount paid is larger than total surrender amount received for a part surrender. If there's an dividend received for the part surrender, do I need to report this amount? Can this dividend be set off against the loss? And, which Box on the tax return SA108 to report the dividend if needed? Thank you.

Hi Karen, 
The dividend would be declared under foreign income and you cannot set the loss against this.
There is no requirement for the SA108.
Thank you. 

 

Hi Admin 25, If the Notice of Policy Surrender has indicated there a surrender value £65,000, the total premium paid £68,000, there is no chargable gain, no need to report this, right? Does the tax payer require to report this event in any other information? If the Notice of Policy Surrender has also indicated there is a divdiend £2,500, this amount should be treated as dividend income or interest income (to be reported under SA106)? If the whole life insurace policy has covered 27 years but the taxpayer are not UK tax resident for the 26 years and only 1 year of the UK tax resident, then the dividend should be apportioned £2,500*1/27 = £93 and this should be reported as income, right?

Hi,
Please refer to:
HS321 Gains on foreign life insurance policies (2024)
Thank you.

Hi Admin, I hope you are doing well. I am still holding a life insurance policy and a critical illness insurance policy in Hong Kong (I am already a tax resident in the UK), do I have to declare the annual dividend in the self-assessment form? Thank you very much.

Hi,
Please refer to guidance at:
HS321 Gains on foreign life insurance policies (2024)
Thank you.