HMRC inflexibility causes reporting headache for clients and advisers
Scottish Life International is disappointed with the HM Revenue & Customs (HMRC) decision not to increase the reporting limits for inheritance tax chargeable lifetime transfers made in the current tax year (2006-07) but is encouraged by the decision to significantly increase the limits for 2007-08 and subsequent years.
Commenting on the decision, Gerry Brown, Technical Manager with Scottish Life International said,
"It is disappointing that, despite continued indications to the contrary, HMRC has not increased reporting limits which have been in place for over 25 years. The current reporting limits, £10,000 for transfers in a single year and £40,000 for cumulative transfers over a ten year period, are so far below the point at which inheritance tax becomes payable as to render the reporting process virtually meaningless in terms of tax yield.
"The proposed increase in limits for 2007-08 (to £200,000 in a single year and £250,000 on a cumulative basis over ten years) will ease the compliance burden. I can't see any reason why they couldn't have been backdated to 6 April 2006.
"Those individuals who put off reporting transfers, in the expectation that the limits would be retrospectively increased, should contact their professional advisers so that the statutory requirements can now be complied with. The time needed to complete the relevant forms will be significant."
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for further information please Contact:
pressoffice@sli.co.im / 0131 456 6031 or
Scottish Life International
Gerry Brown
Technical Manager
Tel: 0131 456 6024
Mobile: 07919 171 587
gerry.brown@sli.co.im
Notes to Editors:
Scottish Life International was launched in 1996 and is now part of the Royal London Group. The company has grown rapidly in size and now has funds under management in excess of £730 million from investors in the UK and around the world (as at 31 December 2006). Scottish Life International is based in the Isle of Man, where it is supervised by the Isle of Man Government Insurance and Pensions Authority.
Scottish Life International is a member of the Association of International Life Offices (AILO) and sponsors IFA Promotion (IFAP), which supports the need for independent financial advice.
Holders of policies issued by Scottish Life International Insurance Company Limited, based in the Isle of Man, will not be protected by the UK Financial Services Compensation Scheme if the company becomes unable to meet its liabilities to them.
Policyholders will however be protected by the Isle of Man Life Assurance (Compensation of Policyholders) Regulations 1991.
Royal London Group is a specialist financial service provider. Its businesses focus on those sectors of the market which value premium propositions, operating through a number of brands:
• Scottish Life - UK pensions market
• Bright Grey - UK protection market
• Scottish Life International - offshore investment markets
• RLAM - fund management
• RLAS - life and pensions administration
Royal London is one of the stronger life and pension companies in the UK, with a current rating of 7/10 from Cazalet Financial Consulting, and has a particularly strong track record for with profits performance.
Royal London is the largest mutual life and pensions company in the UK with Group funds under management of £30.8 billion. Group businesses serve over three million customers and employ 2,640 people. (Figures quoted are as at 31 December 2006.)
Issued by Scottish Life International Investment Group Limited, a Royal London company which is authorised and regulated by the Financial Services Authority. Registered in Scotland number 166387.
Registered office: 19 St Andrew Square, Edinburgh EH2 1YE.