New Guide On Tax Residency For UK Insurance, Financial Firms

by Jason Gorringe, Tax-News.com, London

28 December 2015

The Association of British Insurers (ABI) and the Association of Professional Financial Advisers (APFA) have published updated joint guidance for insurers and financial advisers on the tax information requirements for new customers following changes to UK tax regulations.

The new requirements are intended to ensure that the UK can exchange relevant tax information with other countries' tax authorities under the OECD's new Common Reporting Standard for the automatic exchange of information for tax purposes and also the US Foreign Account Tax Compliance Act.

The new requirements require life insurers to know the tax residency status of their customers acquiring certain life policies and purchased life annuities. This will include both purchases and assignments of products.

The Know Your Customers' Tax Residency guide, released on December 23, sets out the ABI and APFA's views on:

• How the roles and responsibilities of both the insurer and the financial adviser could be divided;
• How to collect tax residency information for new policies;
• How to fill out the suggested confirmation of verification of identity forms; and
• Assessing the tax residency of existing policyholders.

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