Commercial Risk: LIIBA announces deal with TMF for tax on global programmes |
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The London and International Insurance Brokers’ Association [LIIBA] has teamed up with TMF VAT & IPT Services, a company that specialises in tax compliance services for the insurance industry, to help its members calculate tax payable on insurance policies around the world on a territory-by-territory basis. LIIBA, whose insurance and reinsurance broker members operate in the London and international markets and handle in excess of £3bn of premiums through the London market and billions more globally, said that compliance with premium tax laws on an international basis is one of the biggest concerns of buyers and underwriters of global insurance and reinsurance programmes. It has therefore decided to use TMF’s IPT Quote system as its ‘preferred tool’ for members. LIIBA’s move follows news revealed last week at the FERMA President’s Forum in London that the federation is working on a similar initiative to help European risk and insurance managers to secure greater certainty and clarity on compliance and tax issues related to global programmes. FERMA President Peter den Dekker concluded proceedings on day one of last week’s meeting with a call for a more joined-up approach to try and head off any potential compliance problems and said that the federation has started work to find a solution. Meanwhile the European Captive Insurance and Reinsurance Owners’ Association [ECIROA] told Commercial Risk Europe recently that it has kicked off an initiative with the International Association of Insurance Supervisors [IAIS] to try and find greater consistency with the supervisory community. VAT, GST, US Surplus Lines and other premium taxes varyLIIBA said that it decided to act because the amount of Insurance Premium Tax, VAT, GST and US Surplus lines and other taxes payable on premiums varies from jurisdiction to jurisdiction and from class to class and, in some cases like the United States, there are big internal variations. There are also differences over who should pay the tax – the buyer, broker or underwriter. “Since some rules are hard to interpret and liable to change without much notice, it is a huge challenge for brokers, insurers and their clients to be sure they have met their respective tax obligations at all times,” said LIIBA. IPT QUOTE covers over 200 countriesIPT Quote is an online calculation tool that covers over 200 countries and enables brokers to provide quick and detailed calculations as to the tax payable on global re/insurance programmes, said the association. “We see this as a big step forward for the London market as a whole. Global insurance premium tax is incredibly complex, and it is an issue that concerns not just brokers but our clients and underwriters as well. We believe that using IPT Quote will significantly reduce the chances of inadvertent non-compliance,” said LIIBA Chief Executive David Hough. LIIBA said that it selected IPT Quote after reviewing the alternatives and is recommending it to all its insurance and reinsurance members. “We look forward to being of service to LIIBA members. Tax on insurance premiums is a burdensome issue, and we hope that IPT Quote will save people working in the London market a lot of time and worry,” said TMF VAT & IPT Managing Director, Richard Asquith. |
