Section 522 | Method for making annual calculations under section 515

(1)This section deals with the calculation required to be made in relation to a policy or contract as at the end of an insurance year under section 515 to determine—

(a)whether a gain has arisen in relation to that year, and

(b)if so, the amount of the gain.

(2)There is a gain if, as at the end of the insurance year, the sum of PP and TPE exceeds TSG.

(3)In subsection (2)—

PP is the total amount of premiums paid up to the end of the insurance year,

TPE is the total amount of personal portfolio bond excesses (see section 523), and

TSG is the total amount of part surrender gains (see section 524).

(4)The gain is equal to 15% of the excess.