Snippets on Reinsurance arrangements

There shall be excluded from the operation of section 442A any reinsurance arrangement in respect of a policy which falls within any of the descriptions prescribed by paragraphs  below.
 The description prescribed by this paragraph is of any reinsurance arrangement where—  both the cedant company and the reinsurer are insurance companies which are either resident in the United Kingdom or, as respects the reinsurance arrangement or, as the case may be, the business to which the reinsurance is attributable, are within the charge to corporation tax by virtue of section 11 of the Taxes Act;

 

  The cedant company is a 90% subsidiary of the reinsurer, or the reinsurer is a 90% subsidiary of the cedant company, or each is a 90% subsidiary of another body corporate; and the reinsurer is not a company which is charged to tax under Case I of Schedule D.The description prescribed by this paragraph is of any reinsurance arrangement where the reinsurer is a company which in the relevant period is chargeable to tax under the laws of the territory in which it is domiciled or resident in respect of amounts to which the reinsurance arrangement gives rise;the head office of the reinsurer is in an EEA State;

 

  The charge to tax in the relevant period is such a charge made otherwise than by reference to profits as (by disallowing their deduction in computing the amount chargeable) to require sums payable and other liabilities arising under reinsurance arrangements to be treated as sums or liabilities falling to be met out of amounts subject to tax in the hands of the reinsurer; The rate of tax fixed for the purposes of that charge in relation to the amounts subject to tax in the hands of the reinsurer (not being amounts arising or accruing in respect of investments that are of a particular description for which a special relief or exemption is generally available) has in the relevant period been at least 20 per cent.;

  None of the obligations of the reinsurer under the reinsurance arrangement to pay any sum or meet any other liability, other than obligations in respect of mortality risk or morbidity risk, has itself been the subject of a reinsurance arrangement; no deposit-back arrangements are in force in respect of the reinsurance arrangement;