IPTM7835 | Personal portfolio bonds (PPB): requirements for insurers to report PPB gains

The general requirements on insurers to supply chargeable event certificates to policyholders and HMRC also apply when PPB gains arise.

PPB gains on policies and contracts from UK insurers

An insurer is required to report a PPB gain to a policyholder and, if the gain is large enough, to HMRC in the same way as for gains on calculation events generally. IPTM7100 onwards gives full guidance on insurers’ obligations, including destination of certificates, information to be provided and time limits.

To summarise, where a PPB gain arises on a policy, a certificate reporting the PPB gain must:

• always be provided to the policyholder, and

• also to HMRC where the gain exceeds half the basic rate limit for the tax year in which it arises.

It follows that insurers need to retain full details of the nature and history of the policy to ensure that they are aware that the policy is a PPB and have the information to enable them to calculate the amount of the gain that must be reported.

PPB gains on policies and contracts from overseas insurers

Where a PPB was taken out on or after 6 April 2000 with an overseas insurer, the reporting requirements are the same as for a UK insurer.

Where the policy was taken out before 6 April 2000, the insurer is not required to provide any information about the gain.